Given the re-enforced enhanced community quarantine (ECQ) measure in the NCR plus bubble, state-run Power Sector Assets and Liabilities Management Corporation (PSALM) has moved by two weeks or until April 23 this year the submission of tenders for the privatization of the 650-megawatt Malaya thermal power plant.
The mode of divestment decided for the facility – including its underlying site – shall be via ‘negotiated deal’; and offers’ submission had been previously slated on April 7 this year.
But given the snags caused by the rising infections due to the Covid-19 pandemic, PSALM advised qualified bidders on the re-scheduling on the lodgment of documentary deliverables to April 21; and the bid submission deadline getting deferred to April 23.
According to PSALM, it is still leaning on the continued interest of three prospective bidders for the targeted sale of the Malaya asset – and these investors include AC Energy Corporation, Fort Pilar Energy Inc., and VBB Trucking, Trading and Consultancy Services Inc.
“The new timeline will allow negotiating parties more time to complete their documentary deliverables submission, especially in securing documents that need to be certified by issuing agencies,” the asset-seller company has stipulated.
The government firm further qualified “these adjustments in the dates were done in recognition of the challenges that bid participants may face in securing necessary documents while Metro Manila is under ECQ.”
ECQ is the most rigid form of quarantine protocol in the country since the strike of the Covid-19 pandemic last year – and under such circumstances, corporate establishments and government offices would have limited scale of operations.
The Malaya plant is a major asset targeted for divestment by the current administration, so it can raise additional cash to settle the remaining power sector liabilities placed under PSALM’s charge, but despite several tries at the auction block, the company-seller has yet to gain success.
“Proceeds of the sale will be utilized to augment funds needed to settle PSALM’s assumed financial obligations,” the company said.
The Malaya plant has been traditionally lined up as a must-run unit (MRU) that can be readily called on for dispatch by the system operator when there is sudden tightening of power supply in the Luzon grid.
But with its targeted privatization, PSALM stated that the sale terms of reference (TOR) already gives preference to the buyer as to how it would want to utilize the facility upon turnover.