MANILA, Philippines - The Power Sector Assets and Liabilities Management Corp. (PSALM), the agency tasked to privatize state-owned power assets, finally closed yesterday the sale of the 218-megawatt Angat Hydroelectric Power Plant in Bulacan to Korea Water Resources Corp. (K-Water).
PSALM said K-Water has officially taken over the operations of the facility, among the biggest power assets privatized by the state-run firm.
“With K-Water’s payment of the purchase price, government can finally close the highly anticipated sale of the Angat HEPP. The actual turnover of operations of the Bulacan-based hydro plant to its new owner will commence at midnight of Oct. 31, 2014,” PSALM president and chief executive officer Emmanuel R. Ledesma Jr. said.
K-Water won the auction for the Angat HEPP on April 28, 2010 with its bid of $441 million, beating other bidders such as First Gen Northern Energy Corp., San Miguel Corp., SN-Aboitiz Power Pangasinan Inc., Trans-Asia Oil & Energy Development Corp. and DMCI Power Corp.
K-Water turned over the payment of $441 million or P19.662 billion to the government via the Land Bank of the Philippines.
PSALM has been trying to sell K-Water since 2010 but the Supreme Court issued an order that year suspending the asset sale following a complaint filed by petitioners Initiatives for Dialogue and Empowerment through Alternative Legal Services (IDEALS) Inc., et al, which questioned the legality of PSALM’s conduct of the bidding for the Angat HEPP.
However, in 2012, the Supreme Court upheld the legality and validity of the conduct of the bidding process and the subsequent issuance of a notice of award to K-Water.
With the clearance from the Supreme Court, PSALM issued the certificate of effectivity (CoE) of the asset purchase agreement (APA) to K-Water on Sept. 2, 2013, effectively setting in motion the closing of the sale.
Nonetheless, it still took more than a year to finally close the sale due to several requirements that still needed to be finalized, such as K-Water’s loan requirements.
Located in San Lorenzo, Norzagaray in Bulacan, the Angat HEPP consists of four main units, each with a 50-MW capacity. The units were commissioned between 1967 and 1968, PSALM data showed.
To augment its operation, the plant uses five auxiliary units with a total capacity of 46 MW. The 18-MW Auxiliary Units 1, 2 and 3 are part of the sale, while the 28-MW Auxiliary Units 4 and 5, which are owned by the Metropolitan Waterworks and Sewerage System, were not part of the bidding.
The sale merely involves the power plant component of the Angat Dam, Ledesma said, adding that the privatization of the Angat HEPP will not affect the water supply from the Angat reservoir as the Angat Dam remains the property of the Philippine government.