PSALM to bid out today Tiwi-Makban complex

After several delays, the Power Sector Assets and Liabilities Management Corp. (PSALM) will bid out today the 289-megawatt Tiwi and 458.53-MW Makban geothermal complex.

PSALM confirmed it will close the bidding by 12 noon, followed by the screening of the documents at 1:30 p.m..

PSALM vice president for asset management and electricity trading Froilan Tampinco earlier said there are four pre-qualified bidders for the Tiwi-Makban assets.

Although Tampinco declined to identify the bidders, sources indicated they include Aboitiz Power Renewable, Korea Electric Power Co., Suez Energy and Lopez-owned Energy Development Corp..

Though sources said Suez Energy is contemplating on backing out from its bid for Tiwi-Makban, Tampinco said the European power firm is still part of the list of bidders.

“Suez is one of the pre-qualified bidders,” the PSALM official said.

There were earlier apprehensions that the bidding for the Tiwi-Makban geothermal power facilities may be pushed back anew with still unresolved issues on geothermal supply contracts.

From the earlier planned bidding date of June 27, the schedule of the auction was  moved to July 30 this year. The bidding for Tiwi-Makban was previously scheduled last June 4.

PSALM had been pushing back the bidding date for Tiwi-Makban because of unsettled geothermal supply issues.

The bidders earlier expressed concern over the lack of ample time to conduct their respective due diligence activities.

PSALM, however, is confident it would gain the full support and participation of the qualified bidders in the upcoming bidding exercise after it attached more than 400-MW of power supply contracts to the sale of the Tiwi-Makban power facilities.

This supply contract will provide the new owner a ready market for the electricity that the power complex will generate.

With the expected sale of the Tiwi-Makban geothermal complex, PSALM hopes to reach a significant output that will bring it closer to the 70-percent privatization target for the generating assets of the National Power Corp. in Luzon and the Visayas.

By reaching the 70-percent privatization target, it would fulfill one of the preconditions for implementing open access and retail competition in the Philippine electricity industry.