With majority of the members of the Joint Congressional Power Commission (JCPC) having thumbed down the first two privatization schemes already presented by the Philippine National Oil Company-Energy Development Corporation (PNOC-EDC), energy officials have been strongly advised to work on a third scheme that would clear up all issues and concerns raised by the oversight congressional body.
It was gathered that a third privatization option has already been charted; and that was already presented initially to the JCPC members that raised most of the objections on their earlier plans.
"We are confident that the third scheme will finally get JCPC’s endorsement because when it was presented to some of them, there was no resistance to it," revealed one of the PNOC-EDC privatization planners.
With this in tow, the energy official noted that the state-run energy firms long-drawn-out divestment plan would finally be accomplished.
At the same time, hopes are raised that PNOC-EDC’s privatization would also advance bids on the divestiture of the geothermal-based generation assets of National Power Corporation; which is likewise suffering from delays.
Just two weeks ago, PNOC-EDC bared that they have been considering a second option on their privatization blueprint; one that offers a steam sales agreement for the NPC plants and that these shall be in force for 25 years or until 2031.
But just the same, this was given a lukewarm response by the JCPC, a very important body of which endorsement on the company’s privatization plan is highly necessary before things can move forward.
Of course, the first rejected divestiture plan proposed to put together the steamfield assets of PNOCEDC and the spinoff off geothermal plants of the Power Sector Assets and Liabilities Management Corporation; as packaged privatization of the geothermal complexes is prescribed under the Electric Power Industry Reform Act.
While PNOC-EDC’s acceptable privatization blueprint is being finalized, company officials divulged at least 14 mix of local and foreign firms that set initial interest to join the bidding for the 40-percent shareholdings that have been planned to be offered to strategic investors. The inquiries and expressions of interest were channeled through the firms privatization advisor, CLSA Exchange Capital.
These include Enel of Italy; Enex Ltd of Iceland; China Power Corporation; Japanese firms Marubeni Corporation, Sumitomo and Mitsui Corporation; and US firms AES and Noble Energy, Inc.; the local aspirants are the Ayala Corporation; Aboitiz Equity Ventures; Salcon Power and Trans-Asia Power Generation Corporation; and two deep-pocketed investment firms; namely the AIG and International Finance Corporation.
Under the original plan, aside from offering initial 40-percent to block investor and set aside the other 20-percent for public listing; the other variants eyed would be to gradually increase the share of the private sector to more than 50-percent; but that government guarantee on current obligations shall be upheld.
But questions were raised as premised on the law’s mandate that PSALM is the sole agency responsible for the privatization of the power assets, including the geothermal steam fields.
The assets initially planned to be lumped together in the PNOC-EDC privatization would include the 720-megawatt Tongonan 1-3 plants; 192MW Palinpinon and 108MW Mt. Apo geothermal complexes. (MMV)
