Government readies privatization of Mindanao coal plant

MANILA, Philippines — After privatizing two hydroelectric facilities in Luzon, the Marcos administration is now moving to assess the value of Mindanao’s first coal-fired power plant ahead of its sale.

The state-run Power Sector Assets and Liabilities Management Corp. said PSALM is seeking consultancy services to conduct a third-party financial valuation for the privatization of the 232-megawatt STEAG Mindanao Coal.

In a procurement announcement, PSALM said the consultancy would help determine the optimal financial and valuation framework for the plant.

The consultant will also advise PSALM in presenting and defending the valuation methodology and results before government institutions that include the Energy Regulatory Commission and Congress.

The Mindanao facility is a baseload power plant located on a 55-hectare site within the PHIVIDEC Industrial Estate in Misamis Oriental.

It was developed under a 25-year build-operate-transfer agreement between the National Power Corp. and State Power Development Corp., a consortium of State Investment Trust and Harbin Power Engineering.

Aboitiz-led SPI Power, formerly known as STEAG State Power, currently operates the coal plant under a power purchase agreement.

The company rebranded as SPI Power after AboitizPower acquired a majority stake from German firm STEAG GmbH in 2023, from which the coal plant originally took its name.

PSALM, meanwhile, buys Mindanao Coal’s electricity output under a 25-year cooperation period set to expire on Nov. 15, 2031. At the end of the contract, ownership of the plant will be transferred to PSALM.