MANILA, Philippines - SMC Global Power Holdings Corp., the power generation arm of diversified conglomerate San Miguel Corp., has scored a preliminary injunction against Power Sector Assets and Liabilities Management Corp. (PSALM) from terminating an agreement involving the 1,200-megawatt Ilijan combined cycle power plant.
In a disclosure to the Philippine Stock Exchange yesterday, SMC said the Mandaluyong RTC Branch 208 issued a preliminary injunction order in favor of South Premiere Power Corp. (SPPC).
The temporary restraining order (TRO) issued by the local court lapsed on Sept. 28.
The order enjoins PSALM “from further proceeding with the termination of the independent power producer administration (IPPA) agreement between SPPC and PSALM while the main case is pending.”
This means PSALM cannot cancel the contract “for the duration of the trial until a decision on the merits is reached,” SMC said.
SMC said SPPC posted an additional bond of P500,000 in accordance with the court order.
A hearing for the main is set for Oct. 22, 2015 at 1:30 p.m., the company noted.
Last Sept. 4, PSALM terminated the IPPA agreement for the Ilijan plant for SPPC’s failure to pay the outstanding generation payments from Dec. 26, 2012 to April 25, 2015 amounting to P6.46 billion.
SMC Global chairman Ramon Ang earlier said the company will sue PSALM for “intentional breach of contract.”
The IPPA for the Ilijan plant was bid out by PSALM in April 2010, where SMC emerged as the highest bidder with an $870 million offer.