4 firms qualified to bid for Negros geothermal project

The PNOC-Energy Development Corp. (PNOC-EDC), the geothermal unit of the Philippine National Oil Co. (PNOC), has qualified at least four foreign firms to bid for the 40-MW Northern Negros geothermal project (NNGP).

PNOC-EDC chairman and president Sergio Apostol said the four are Marubeni Corp., Kanematsu Corp., and Mitsubishi Corp., of Japan and Israel’s Ormat Industries, Ltd.

Apostol said the bidding will be for a full turnkey project to include the engineering design, supply, delivery, installation, testing and commissioning of the power facility.

The four firms, he said, are scheduled to submit their respective bids in June while awarding of contract to the winning bidder will be in September this year.

He said the project will be financed through an official development assistance (ODA) grant from Japan Bank for International Cooperation (JBIC).

"We accelerated development activities for NNGP to meet a 2004 timetable for commercial operation. The NNGP will not only be PNOC-EDC’s first fully-owned power plant. It will also be the Philippines’ first power project to operate as a merchant plant under the new electricity environ-ment,"Apostol said.

Prior to the passage of the Electric Power Industry Restructuring Act (EPIRA), all independent power producers such as PNOC-EDC had to sell the power that they generate to Napocor under a power purchase agreement (PPA).

Under the merchant plant option, PNOC-EDC will only have to pay wheeling charges for the use of Napocor’s transmission lines and the electric cooperatives’ distribution lines to deliver the power to its clients.

"We can sell directly to the electric co-ops and large industrial consumers. The merchant option would then teach us the rudiments of transmission and distribution. This way, we hope to provide better power services and better-priced electricity direct to the end-user," Apostol said.