Monte Oro forms P2-B company to operate TransCo concession

The Securities and Exchange Commission (SEC) has approved the registration of National Grid Corp. of the Philippines, a P2-billion company formed by a group led by Monte Oro Grid Resources Corp., which won the 25-year concession of the country’s national transmission grid.

Based on documents filed with the SEC, National Grid will primarily engage in the operation of a nationwide transmission grid throughout the country. Out of the P2-billion authorized capital stock, P500 million has been subscribed and paid by Monte Oro Grid (P149.99 million), and its partners Calaca High Power Corp. (P149.99 million) and State Grid Hong Kong Ltd. (P199.99 million).

Its incorporators include mining executive Water Brown, former Philippine Stock Exchange chairman Wilson Sy, businessman-stockbroker and former PSE chairman Robert Coyiuto Jr., Elmer Pedregosa, Anthony Almeda, Du Zhigang, Ruan Qiantu, Zhu Guangchao, and Yao Yousheng. Monte Oro and its partners tendered the highest bid price of $3.95 billion while the consortium of San Miguel Energy Corp. and partners Dutch firm TPG Aurora BV and Malaysia’s TNB Prai Sdn Bhd offered $3.905.

National Grid is positioned to operate the country’s national transmission system with the concessionaire’s technical expertise and impressive track record in the power sector.

State Grid Corp. is China’s largest power grid operation company and ranked 29th in the Fortune 500 Largest Corporations in 2006. It is serving 88 percent of China’s territories covering more than one billion people.

“Once the new concessionaire operates the transmission grid, the Philippines can expect a world-class transmission system with plants and equipment running at maximum efficiency and reliability,” National Grid said.

National Grid said it would immediately implement various projects approved by the Energy Regulatory Commission to ensure power supply reliability and improved services for customers. The Monte Oro consortium will pay 25 percent downpayment of the total bid once franchise is granted and pay the remaining 75 percent in the next 20 years. It will shell out $725 million until 2010 to upgrade and modernize the facilities of Transco to be able to sustain the uninterrupted supply of power to customers.