PSALM targets Angat sale closing in January

MANILA, Philippines - The Power Sector Assets and Liabilities Management Corp. (PSALM), the government agency tasked to oversee state-owned power assets, is targeting to close the sale of the Angat hydropower plant in Bulacan in January next year.

PSALM sold the 218-megawatt power facility to K-Water Resources Corp. of Korea.  It issued the certificate of effectivity (COE) to K-Water in September and is expected to close the sale within 270 days from the COE issuance.

PSALM president Emmanuel Ledesma Jr. said the sale may be closed as early as mid-January.

“With both PSALM and K-Water’s commitment to complete their deliverables, I expect the closing sale to push through mid-January the earliest,” Ledesma said in an interview with reporters.

PSALM conducted the bidding for the $440.88-million facility in 2010.

K-Water topped the bidding but was unable to immediately take over the plant due to thorny issues including court hurdles raised by non-government organizations (NGO) on the foreign takeover of a power assets.

The Supreme Court last year upheld the privatization of the power plant but K-Water had negotiated with the government for a lower price tab on the facility, saying it wanted the same level of benefits expected in its 2010 bid.

Energy Secretary Carlos Jericho Petilla and K-Water officials have been in talks for months before finally reaching an agreement, which led to the COE awarding in September.

In the end, K-Water agreed to the original bid price of $440.88 million. K-Water partnered with diversified conglomerate San Miguel Corp. to run the power facility.

The privatization of Angat, once completed, would be the first successful power asset sale under the Aquino administration, as mandated under the Electric Power Industry Reform Act of 2001.

K-Water will tap an initial $500-million bridge loan from the Korean Exim Bank to jumpstart the takeover.

K-Water is optimistic that its investments in Angat is only the beginning of future projects in hydropower.