By Danessa Rivera (The
Philippine Star) | Updated July 20, 2016 - 12:00am
MANILA, Philippines – The San Miguel
Group’s total unpaid obligations to the Power Sector Assets and Liabilities
Management Corp. (PSALM) for the generated capacity of the 1,200-megawatt (MW)
Ilijan power plant in Batangas has ballooned to over P12 billion, according to
a government source.
The amount is the accumulated
shortfalls in generation payments from June 2010 to April 2016, which includes
undisputed obligations, the source said.
Meanwhile, the San Miguel Group’s
outstanding generation payment covered by PSALM’s demand letter now amounts to
P7.8 billion.
In Sept. 4, 2015, PSALM terminated
the independent power producer agreement (IPPA) for the Ilijan plant with South
Premiere Power Corp. (SPPC) for failure to pay the outstanding generation
payments from Dec. 26, 2012 to April 25, 2015 amounting to P6.46 billion.
SPPC is a subsidiary of SMC Global
Power Holdings Corp., the power unit of the San Miguel Group.
Following the termination of
contract, SMC Global chairman Ramon Ang sued PSALM for “intentional breach of
contract.”
Ang said SPPC had already paid P180
billion in obligations to PSALM for the Ilijan IPPA, broken down into P36
billion in capacity fee and P144 billion
in generation payments, as of
September 2015.
SMC Global, through SPPC, then asked
the Mandaluyong Regional Trial Court (RTC) Branch 208 to prevent PSALM from
terminating the contract, where after the local court issued a preliminary
injunction in favor of the power company after the TRO lapsed.
Recently, San Miguel Corp. and
Manila Electric Co. (Meralco) have confirmed they are in talks for a possible
partnership for the Ilijan power plant, which is the asset involved in the case
still lodged at the Mandaluyong City RTC.
“We offered to sell 49 percent of
Ilijan power plant to Meralco and we are in talks but we can only close the
deal once the court case which we have filed against PSALM has been resolved,”
Ang said last week.
Meralco president Oscar Reyes said
the company is in “very early discussions” with the San Miguel Group for a
possible 49 percent investment in the power plant through SPPC.
However, the deal depends on the
resolution of the case filed against PSALM. Energy Secretary Cusi also said SMC
would need the approval of government to be able to sell part of its interest
in the Ilijan plant.
SMC bagged the Ilijan IPPA in April
2010 after it outbid other parties with a $870 million offer. SPPC was then
issued the certificate of effectivity as the Ilijan plant’s IPPA after all
conditions precedent had been met.
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