First Gen gets award notice from PSALM for Pantabangan-Masiway hydropower plant
The Philippine Star 10/05/2006
Lopez-owned First Gen Hydro Power Corp. said yesterday that the Power Sector Assets and Liabilities Management Corp. (PSALM) has issued the notice of award for the company’s purchase of the 112-megawatt (MW) Pantabangan-Masiway hydroelectric power plant complex in Nueva Ecija.
PSALM is the government agency tasked to handle the privatization of the generation and transmission assets of the National Power Corp. (Napocor).
In a disclosure to the Philippine Stock Exchange, First Gen Hydro, a wholly-owned subsidiary of publicly-listed First Gen Corp., said it won over SN-Aboitiz Power Corp. in the successful bidding conducted by PSALM last Sept. 8. First Gen Hydro submitted a higher bid of $129 million.
With this acquisition, First Gen Corp. will have a total of 1,839 MW of installed generating capacity, accounting for almost 12 percent of the country’s total installed capacity.
First Gen’s other subsidiaries currently own and operate the 1,000-MW Santa Rita and 500-MW San Lorenzo natural gas-fired power plants in Batangas City, the 225-MW Bauang diesel power plant in La Union, and the 1.6-MW Agusan hydroelectric plant in Bukidnon.
According to First Gen, its foray into hydropower is a significant step towards fulfilling the company’s aspirations to diversify its portfolio and help protect the environment.
The Pantabangan-Masiway plant was practically the first big ticket item sold by PSALM since it started the privatization of Napocor assets in 2004.
The Pantabangan hydropower plant is located in San Jose, Nueva Ecija and is composed of two 50-MW units. Both are commissioned in 1977.
The Masiway power facility, on the other hand, is located near the Pantabangan power plant and was commissioned in 1981.
First Gen also won in the bidding for the 1.6-MW Agusan hydropower plant auctioned off by PSALM last year for $1.53 million.
Next on the auction block is the 360-MW Magat hydroelectric complex in Isabela and the 25-year concession of TransCo (National Transmission Corp.).
Under the asset purchase agreement (APA), First Gen will sign a land lease agreement with PSALM, and the operation and maintenance agreement with the National Irrigation Administration for the non-power components.
The APA for the Pantabangan-Masiway facility requires the winning bidder to deliver at least 40 percent of the purchase price as upfront payment payable on or before the closing date. The balance of 60 percent may be paid in 14 equal semi-annual payments with an interest of 12 percent per annum compounded semi-annually.
The winning bidder is also required to post a performance bond of $2.58 million, equivalent to two percent of the purchase price. The performance bond will be reduced every year equivalent to two percent of the aggregate amount of the deferred payments.
In addition, the winning bidder will be required to post a deferred payment security deposit equivalent to at least the next deferred payment in the form of cash, currently dated manager’s check or an irrevocable standby letter of credit acceptable to PSALM.
Lopez-owned First Gen Hydro Power Corp. said yesterday that the Power Sector Assets and Liabilities Management Corp. (PSALM) has issued the notice of award for the company’s purchase of the 112-megawatt (MW) Pantabangan-Masiway hydroelectric power plant complex in Nueva Ecija.
PSALM is the government agency tasked to handle the privatization of the generation and transmission assets of the National Power Corp. (Napocor).
In a disclosure to the Philippine Stock Exchange, First Gen Hydro, a wholly-owned subsidiary of publicly-listed First Gen Corp., said it won over SN-Aboitiz Power Corp. in the successful bidding conducted by PSALM last Sept. 8. First Gen Hydro submitted a higher bid of $129 million.
With this acquisition, First Gen Corp. will have a total of 1,839 MW of installed generating capacity, accounting for almost 12 percent of the country’s total installed capacity.
First Gen’s other subsidiaries currently own and operate the 1,000-MW Santa Rita and 500-MW San Lorenzo natural gas-fired power plants in Batangas City, the 225-MW Bauang diesel power plant in La Union, and the 1.6-MW Agusan hydroelectric plant in Bukidnon.
According to First Gen, its foray into hydropower is a significant step towards fulfilling the company’s aspirations to diversify its portfolio and help protect the environment.
The Pantabangan-Masiway plant was practically the first big ticket item sold by PSALM since it started the privatization of Napocor assets in 2004.
The Pantabangan hydropower plant is located in San Jose, Nueva Ecija and is composed of two 50-MW units. Both are commissioned in 1977.
The Masiway power facility, on the other hand, is located near the Pantabangan power plant and was commissioned in 1981.
First Gen also won in the bidding for the 1.6-MW Agusan hydropower plant auctioned off by PSALM last year for $1.53 million.
Next on the auction block is the 360-MW Magat hydroelectric complex in Isabela and the 25-year concession of TransCo (National Transmission Corp.).
Under the asset purchase agreement (APA), First Gen will sign a land lease agreement with PSALM, and the operation and maintenance agreement with the National Irrigation Administration for the non-power components.
The APA for the Pantabangan-Masiway facility requires the winning bidder to deliver at least 40 percent of the purchase price as upfront payment payable on or before the closing date. The balance of 60 percent may be paid in 14 equal semi-annual payments with an interest of 12 percent per annum compounded semi-annually.
The winning bidder is also required to post a performance bond of $2.58 million, equivalent to two percent of the purchase price. The performance bond will be reduced every year equivalent to two percent of the aggregate amount of the deferred payments.
In addition, the winning bidder will be required to post a deferred payment security deposit equivalent to at least the next deferred payment in the form of cash, currently dated manager’s check or an irrevocable standby letter of credit acceptable to PSALM.
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