PSALM defers sale of state power assets

Power Assets and Liabilities Management Corp. (PSALM) has deferred the scheduled sale of government’s remaining power assets for rest of 2010 citing various reasons, the state-run firm said this weekend. The firm has decided to hold the sale of Power Barge (PB) Nos. 101 to 104, said PSALM vice president Conrad Tolentino in a statement. “No power assets will be sold in the next two months." Each diesel-run power barge now stationed in the Visayas has a capacity of 32 megawatts. PB 101 was commissioned in 1981 and the rest were commissioned in 1985. Tolentino said that PSALM has started preparing for the sale of the National Power Corp.’s (Napocor) real estate and non-power assets. “Real estate assets are scattered across the country with varying land areas or sizes. Non-power [assets] are scrap materials and equipment from the power plants," he explained. Other facilities PSALM said the appointment of independent power producer administrators (IPPAs) for the Unified Leyte geothermal power plant, the Naga power plant complex, and the Malaya thermal power plant has also been put on hold. It still needs to schedule the bidding for IPPAs to administer the contracted capacities of the 782-megawatt (MW) Caliraya-Botokan-Kalayaan hydropower plants, the 100-MW Western Mindanao Power Corp., the 50-MW Southern Philippines Power Corp., the 200-MW Mindanao coal power plant, the 92.52-MW Mt. Apo 1 and 2 geothermal power plants, and the 165-MW Casecnan hydroelectric power plant. The privatization of the Agus-Pulangui hydro complex and the Sucat facility will follow the process imposed by the Energy Department or the PSALM board or an appropriate authority. PSALM said the sale of the Agus-Pulangui power plants will be done in consultation with Congress. The Sucat plant, meanwhile, may be recommissioned by the Energy Department as part of its Energy Reform Agenda. Raising funds PSALM pointed out that it might raise funds in pesos next year to settle the maturing debts of the Napocor in 2011. Napocor’s maturing obligations in 2011 — inclusive of interest — amount to about $1.2 billion including a $200-million bond that will mature next March and $400 million worth of floating rate notes falling due next August, PSALM said. The present liability management program of PSALM allows the firm to either tap the local capital market or engage in dollar financing to settle the obligations. “PSALM is leaning towards raising the necessary funds in the local currency, considering the successful government launch of the peso bonds in September. The final choice however will depend on what the PSALM board will deem as more advantageous to the government," it said. The PSALM board will meet this week on the firm’s liability management program and its privatization schedule. Under the board-approved second phase liability management program, PSALM has peso bonds or credit facility totaling P50 billion and up to $1 billion in bonds. PSALM has yet to use the remaining P20 billion of the P50-billion peso bonds. — With Jesse Edep/VS, GMANews.TV