Masinloc plant to be rebidded

Finance Secretary Margarito Teves, who is also chairman of the Power Sector Assets and Liabilities Management Corp. (PSALM), said yesterday that a new bidding process is underway for the sale of the 600-megawatt Masinloc power plant in Zambales.

This was after the Joint Congressional Power Commission (JCPC) ordered PSALM to terminate the sale of the Masinloc plant to YNN Pacific consortium, which failed to pay the $277-million downpayment despite several extensions.

Teves, however, said that Ranhill Berhad, a publicly listed Malaysian firm which allegedly bought YNN, "might" be able to join the re-bidding.

"There will be a new set of bidding rules and within those bidding rules there might be interested parties, one of which might be — and I said might be — Ranhill," Teves said in an interview at the Senate last Thursday during the inquiry on the Masinloc sale by the JCPC.

Malacañang said though that it would revise some rules to attract more bidders and reduce possible future kinks.

"We are abiding by the recommendation of our economic managers, particularly (Energy) Secretary (Raphael) Lotilla. This is the palace position," presidential chief of staff Michael Defensor said.

Teves said the PSALM has served the notice of termination to YNN. He also disclosed that even before the JCPC formalized its recommendation Thursday to cancel the deal by Aug. 6, PSALM had already terminated the contract.

"The contract is fully terminated…This is now part of the winding down period," he said, explaining that there is a 30-day period specified in the contract to allow the other party to wind down their activities associated with the project.

"First, you need to serve notice, which we did last July 7," he said, clarifying that although the $14-million performance bond of YNN was forfeited in favor of the government, the power plant cannot be transferred "until they fully pay the balance."

Lotilla, for his part, said that there will definitely be a re-bidding as they are also slated to privatize the generation assets of the National Power Corp. (Napocor).

He admitted that the reluctance of Ranhill Berhad to put in money in the Masinloc deal is due to the fact that there is no contract yet between Napocor and the Manila Electric Co. (Meralco) for the supply of electricity.

The energy chief said the government would try to work out the supply contract between Meralco and Napocor to make the Masinloc plant attractive to buyers.

Immediate solution

Meanwhile, Sen. Edgardo Angara called for the immediate solution of the long-standing investigation on the sale of Masinloc and the conflict between former President Fidel Ramos and Sen. Miriam Defensor Santiago, who co-chairs the JCPC.

Angara said these issues should not be allowed to affect the re-bidding process.

"We really have to help the (Napocor) privatize these power stations. Even though the public does not use the energy capacity produced by these independent power producers, the public continues to pay for them," Angara said in a statement.

He expressed belief that Ramos and Santiago are capable of transcending their political and personal differences to come up with a probable solution to the Masinloc problem.

"Both of them are state persons. I don’t think their political differences and personal conflicts will get in the way of the inquiry. They should avoid creating a circus in the course of the investigation," he added.

The senator also criticized some members of the media for "highlighting" the word war between the two personalities.

"The media spun around the rifts and disputes of opposing personalities instead of looking for solutions and creating unity. This is saddening, and is not helpful at all," Angara said.

He stressed that "the one responsible for the (Masinloc sale) fraud" should be held accountable.

The Palace, however, refused to be involved in allegations that Ramos had a hand in the controversial deal. — With Paolo Romero