SC to decide on assignment of San Pascual contract

The Power Sector Assets and Liabilities Management Corp. (PSALM) is optimistic that it could decide soon where to assign the purchase power contract (PPA) of the 300-megawatt (MW) San Pascual Co-generation Plant.

PSALM president Nieves Osorio said they have received reports that the Supreme Court (SC) is set to issue its opinion on the matter.

"The indication I get is that they would issue a positive statement,"Osorio said. PSALM has sought the legal expertise of the SC if they could transfer or reassign the power supply contract on San Pascual to other generation assets of the National Power Corp. (Napocor).

But the PSALM chief pointed out that once they get the SC opinion, the decision of PSALM on the assignment of the supply contract of San Pascual would be anchored on factors that would best serve the interest of the government.

"We would consider which offer would be the best option in terms of economics and power supply," Osorio said.

Based on the initial plan, PSALM intends to transfer the 25-year PPA contract of San Pascual Co-generation to Sucat power plant.

This proposal is crucial to provide a "sweetener" to the sale of decommissioned 850-MW Sucat power facility.

In case PSALM will not be able to resolve the legal impediments on the proposed PPA transfer, they can sell Sucat with a TSC.

The San Pascual project was supposed to take up the remaining 300 MW from the 3,000-MW Malampaya Deep Water Gas to Power project. The 2,700 MW were distributed to 1,200-MW Ilijan Power Plant; Lopez-owned 1,000-MW Sta. Rita and 500-MW San Lorenzo.

The government had worked out the pre-termination of the contract of San Pascual with US-based Edison Mission Energy since September 2002.