This early in the game, San Miguel Energy Corporation (SMC) is launching foray to pose as ‘tough competitor’ to Korea Electric Power Corporation to become independent power producer administrator (IPPA) for the 1,200-megawatt Ilijan gas-fired power facility.

SMC president Ramon S. Ang already indicated to media his interest to bid for the Ilijan plant’s IPPA, and be a formidable challenger to all other interested parties.

The SMC chief executive dropped such hints following the announcement made by Power Sector Assets and Liabilities Management Corporation (PSALM) on the IPPA auction for Ilijan’s contracted capacity, which is slated April 16 this year.

IPP contractor and plant operator Kepco was among those positioning as Ilijan IPPA. Should the Korean firm finally firms up interest up to the bid opening and submission phase, it will thrive as a record of sort since PSALM wittily refers to Kepco as an investor-group that only holds interest up to the pre-bid level.

It was noted that the Ilijan IPPA will gain favorable revenue streams, since the gas plant’s contract was among the better-negotiated deals, primarily in terms of pricing. If Kepco wins in the bidding, it will be the first IPP player that also corners the IPPA deal for the plant it has been operating.

While the bid notice is not very direct on its prescription as to the proposed splitting of contract volumes, the terms of reference (TOR) manifestly set out that only one IPPA bid is solicited for the asset.

The privatization firm made reference to an “IPPA to manage the Ilijan capacity”, but this does not necessarily put plant operator Kepco into a safe zone relative to earlier apprehensions that the appointment of two IPPAs may trigger monstrous conflict on dispatch schedules.

The invitation to bid (ITB) also stipulated that submission of letters of interest (LOI) is due this January 29, while pre-bid conference with prospective bidders is scheduled on February 11. Issuance of bidding package will be from January 18 to February 8, 2010.

Another gas-fired plant owner and operator First Gen Corporation indicated that it is not interested to join the IPPA bidding for the Ilijan asset.

PSALM’s steadfastness to wind up the power sector’s privatization program evidently lumbers beyond political exercises, as the company schedules successive privatization biddings prior to the May elections.

PSALM said the invitation for the appointment of IPPA to manage the Ilijan capacity, “signals the start of PSALM’s sale process for the Southern Luzon-based power asset.”