posted July 21, 2016 at
11:45 pm by Alena Mae S. Flores
SMC Global Power Corp.,
through unit South Premier Power Corp., on Friday dismissed as “erroneous” the
P12.3-billion unpaid claims of Power Sector Assets and Liabilities Management
Corp. from the 1,200-megawatt Ilijan natural gas power plant.
SMC Global said in a
statement it already paid as of April 2016 P159.67 billion to PSALM, which
manages the assets and liabilities of National Power Corp.
SMC Global’s subsidiary
South Premiere Power Corp. is the the independent power producer administrator
of the Ilijan natural gas power plant in Batangas.
“This is precisely the
reason why we filed a case against PSALM last year—to seek justice from the
court, clear the confusion and set the facts straight. We have been diligently
paying PSALM what is due us. We do not owe PSALM a single centavo. SPPC has
fully paid all its obligations under its Independent Power Producer
Administration Agreement with government,” San Miguel Global said.
On Sept 8, 2015, South
Premiere was constrained to file a complaint before the Regional Trial Court of
Mandaluyong against PSALM due to a willful breach of contract arising from what
the company believed was a flawed interpretation of certain provisions related
to its generation payments under the Ilijan IPPA agreement.
SMC Global said PSALM’s
“unfounded interpretation” had resulted in alleged shortfall in generation
payments by South Premiere. The case also sought to stop PSALM from illegally
terminating South Premiere’s Ilijan IPPA and treating the latter as an
administrator in default.
The Mandaluyong RTC
therefore issued a 72-hour TRO against PSALM.
On Sept. 15, 2016, the
court issued an order granting a preliminary injunction enjoining PSALM from
proceeding with the termination of the Ilijan IPPA agreement with South
Premiere while the main case was pending.
South Premiere earlier
cautioned that the illegal termination could lead to higher electricity prices,
as PSALM reportedly planned to trade the output of Ilijan on the Wholesale
Electricity Spot Market.
South Premiere assured
consumers prices would remain stable as long as status quo was maintained
“Let’s wait for the
court to decide and respect the status quo as the court has thus far ordered,”
SMC Global said. South Premiere filed criminal complaints for estafa and
violation of the anti-graft and corrupt practices act against officers of PSALM
in connection with the earlier termination of the Ilijan IPPA.
“On the part of the
government, we maintain that any disposition made by SMC will be subject to the
claims of PSALM unless otherwise adjudged by the ours,” Energy Secretary
Alfonso Cusi said earlier.
PSALM is led by the
finance secretary as chairman and Cusi as co-chairman.
The Ilijan natural gas
plant is one of the three natural gas power plants in Batangas. It is operated
by Kepco Philippines for the government, but its contract is managed by South
Premiere under an IPPA agreement with PSALM.
South Premiere won the
contract as the independent power producer administrator of the Ilijan plant
during a bidding conducted by PSALM in 2010 with an offer of $870 million.
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