Korean firm tapped as O&M contractor for Casecnan hydro plant
By Myrna M. Velasco
South Korean firm Soosan ENS will be engaged as the operation and maintenance (O&M) contractor for the 165-megawatt Casecnan hydropower plant in Nueva Ecija, according to state-run Power Sector Assets and Liabilities Management Corporation.
The selection of the Korean firm, PSALM emphasized, had been based on the lowest bid it submitted in the October 12 auction of the one-year O&M service contract (OMSC) for the hydropower facility – and that will serve as an interim arrangement that the government had underwritten prior to the plant’s targeted privatization next year.
Soosan’s tender had been at P252,996,800.00, which is manifestly lower than the PSALM Board-approved budget cost of P462 million for the O&M deal.
The Korean company’s winning offer had likewise been way below the offers of SN Aboitiz Power-Magat Inc. at P261,556,168.02; and that of other South Korean company Kepco KPS Philippines Corporation at P391,491,723.84.
“The next stage is for PSALM to subject the bid of Soosan ENS to the post-qualification process,” the state-owned company specified, adding that such undertaking is in accordance with the prescriptions of Republic Act No. 9184 or the Government Procurement Law.
PSALM expounded “the post-qualification process will ensure that Soosan ENS indeed met all the financial and legal requirements as indicated in the bidding procedures.”
The government-run firm said “if Soosan ENS passes the post-qualification process, it will be given sufficient lead time to familiarize itself with the operations of the Casecnan hydro power plant before the contract’s beginning effectivity date on November 26, 2021.”
It is worth noting that prior to the Korean firm’s successful bid in the Casecnan hydropower plant, Soosan was also previously appointed by PSALM as O&M contractor in the 650-megawatt Malaya thermal plant, that was prior to its privatization.
The Casecnan multi-purpose hydropower facility is due for turnover to the government by December this year, on the lapse of the build-operate-transfer (BOT) contract for the asset.
With the anticipated appointment of an interim operator of the hydro facility, PSALM President Irene Besido-Garcia indicated that they can already “proceed to prepare for the ultimate plan of privatizing the Casecnan plant,” which is consistent with its mandate under the Electric Power Industry Reform Act.
The Casecnan asset is a run-of-river type of hydropower development, hence, it has very limited impounding area – and the typical process is that: the water from the reservoir flows into the plant’s powerhouse, then down to the Pantabangan lake and into the irrigation channels.
The facility is being depended upon for power supply being fed into Luzon grid; and it has also been irrigating farmlands, especially in its host-province of Nueva Ecija, which has long been touted as the ‘rice granary’ of the Philippines.