Tuesday, August 14, 2018

PNOC mulls Swiss challenge for P30-billion banked gas


Published August 12, 2018, 10:00 PM By Myrna M. Velasco

State-run Philippine National Oil Company (PNOC) is seriously assessing Swiss challenge option on any offer that it may corner on the targeted rebid of its banked gas that was originally valued at P30 billion.
 “We will study if there will be a need for a Swiss challenge,” PNOC Spokesperson Jannefer G. Pelayo said.
Swiss challenge is one form of public procurement wherein an offer secured by a government or regulated entities be subjected to a bid of a third party that will either match or exceed the original offer.
PNOC said it will be auctioning its banked gas again “for sale through submission of offers which will be evaluated and further negotiated to get the best value for the government.”
It said that in the last bid process, no one qualified “as the base price of PNOC is still the Ilijan price,” which has been pegged at close to US$7 per million British thermal unit (MMBTU).
PNOC said it will send out invitations anew “to all stakeholders and publish the proposed sale in newspapers of general circulations to ensure transparency and competition.”
If it would not be able to corner a desirable tender at its auction process, PNOC indicated that it will “negotiate for the best offer subject to the final approval of the board of directors.”
The state-run company qualified that the banked gas “is an inventory item and therefore exempted from the usual government procurement process.”
PNOC previously crunched that it might be able to fetch proceeds of US$700 million to $800 million from the sale of the banked gas – that is if it will be benchmarked on the Ilijan gas pricing.
The state-run company gained ownership of the banked gas out of the Malampaya project after purchasing it from the government in 2009 – through the Department of Energy, at just half its estimated value at P14.4 billion instead of the full price of P29.5 billion.

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