The Philippine Star
05/27/2006
Philippine National Oil Co.(PNOC) is negotiating with two European firms for a possible farm-in agreement in the West Balabac oil and gas exploration project.
PNOC president Eduardo Mañalac said they are now holding initial discussions with Lundin Oil and Tap Oil, both Europe-based oil exploration companies for a joint venture in service contract (SC) 59 or the West Balabac prospect.
At present, SC 59 is 100-percent operated by PNOC-Exploration Corp., one of the subsidiaries of PNOC. The two European firms, Mañalac said, are currently studying the prospects in the said area.
"They’re looking at the data. We’re at the early stage of discussions with these firms," he said.
At the same time, PNOC is also in talks with Nido Petroleum Exploration Corp. for another possible farm-in agreement in West Calamian near Palawan under service contract (SC) 58.
The West Balabac area lies off the southwestern tip of Palawan. South of the area is the Malaysian border where several offshore oil and gas fields trending northeast are currently in production off the coast of Sabah and Brunei.
Recently, Murphy Oil discovered the giant Kikeh field, estimated to contain 400-700 million barrels of oil in the deepwater area of Sabah, considered as Malaysia’s first deepwater discovery.
Although there is still no production on the Philippine side, PNOC’s interpretation shows that the active petroleum system existing in offshore Malaysia and Brunei continues northward into the western Balabac area.
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The Philippine Star
05/27/2006
US-based Mirant Corp., owner of the largest private power producer in the Philippines, reported a net income of $467 million in the first three months of 2006, a forty-fold increase over the $11-million income posted in the same period last year.
The company said the adjusted net income amounting to $142 million excludes unrealized mark-to-market gains of $298 million along with other non-recurring charges, principally a $40-million gain on the sale of assets. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter stood at $340 million.
The $173-million increase in adjusted EBITDA was driven largely by higher realized margins from hedging activities by the company’s US business. "Our hedging strategy has been effective," Mirant chairman and chief executive officer Edward R. Muller said.
"We are substantially hedged for the year, which has produced more predictable financial results mitigating milder weather experienced across much of the US during the quarter," Muller said. "Our performance demonstrates the value created by our hedging program."
According to the company, its net cash used in operating activities reached $246 million for the quarter. Adjusted for bankruptcy payments, operating cash flow provided a net of $500 million during the period. As of March 31, 2006, the company had cash and cash equivalents of $1.73 billion.
Mirant Philippines chairman Jose P. Leviste Jr. said the income performance of their mother firm is a welcome development.
Mirant Philippines is the largest private producer of electricity in the country. It owns and operates over 2,500 megawatts of generating capacity. It also has a stake in the 1,200-MW-Ilijan natural gas project.
"These are very good numbers posted by our parent company. This motivates the Philippine business unit to work more effectively and efficiently to meet our goals for our stakeholders and targets for the year," Leviste said.
Mirant Corp. is a competitive energy company that produces and sells electricity in the United States, the Caribbean and the Philippines.
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manila Bulletin
May 26, 2006
Despite some hurdles, Energy Secretary Raphael P.M. Lotilla gave indications that Japanese firms are still keen on pouring in fresh capital in the country’s energy sector.
In a recent roadshow undertaken by Philippine government in Tokyo, the energy chief stressed that the response they have gotten was that various Japanese trading houses and companies "have signified interest to invest in the Philippine energy sector."
Accompanying Lotilla in the energy investment mission were Philippine National Oil Company president Eduardo Mañalac and National Power Corporation president Cyril C. del Callar.
"We are optimistic that these companies will seriously consider the Philippines as alternative area for investments now that we are seriously concentrating on reforming our economy," Lotilla said.
Japanese companies that met with the energy officials include Marubeni Corporation, Itochu, Mitsubishi Corporation, Sumitomo and Toyota/Tsoshu.
Lotilla chiefly noted that the high prices of oil "have prompted renewed interest from Japanese corporations to pursue investment opportunities in oil and gas in Asia, particularly in the Philippines."
Key in these investment opportunities being scoured are on the competitive petroleum contracting rounds set out by the Department of Energy.
Apart from Japanese trading firms, Japanese banks also participated in the small-group discussions to see how they can provide financial support for these Japanese companies who are interested to invest in the Philippines.
"Optimism regarding Japanese investments stems from the Philippines advantage of geographical proximity to Japan, unhampered access to international sea routes to and from the Philippines, as well as strong relations between the two countries," the energy department averred.
In line with such investment targets, the Japanese are said to be eyeing joint ventures with private companies or the PNOC for existing oil and gas concessions in the Philippines.
"Investments from Japan will certainly contribute to the acceleration of our energy independence agenda," the energy czar stressed.
The Philippines boasts of having high hydrocarbon potential; but needs huge investments to prove commercial viability of such potential reserves.
Among the considered high-frontier areas are Northwest and Southwest Palawan ; along with those in East Palawan, Sulu Sea; which are surrounded by similar oil and gas geology of proven petroleum provinces in Malaysia, Brunei and Indonesia.
Reed Bank in West Palawan is also seen analogous to some Vietnam and South China oil structures likewise near proven petroleum provinces.
The anticipated passage of the Biofuels Bill is also shoring up interests, as Lotilla emphasized the availability of ethanol and bio-diesel in the Philippines for fuel that can be exported to Japan.
"With the increasing prices of oil in the world market, Japan is expanding the use of biofuels and are now looking at diversifying its sources all over the world and the Philippines is one area that they are currently looking at in Asia," Lotilla added.
At least two Japanese companies confirmed that they were looking at the coco methyl ester (CME) plants in the Philippines as possible sources of biodiesel for Japan
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Manila Bulletin
May 26, 2006
The largest Northern Luzon-based consumer group recently called for a "united front" among people’s organizations in the bid to block the latest planned generation rate hike by the National Power Corporation (Napocor).
The Timpuyog Mannalon Amianan issued the call in the wake of the petition filed last month by Napocor before the Energy Regulatory Commission (ERC) for rate increase. The petition seeks an additional R0.39 per kilowatthour increase for Luzon, P0.09 per kilowatt-hour for Visayas and P0.03 for Mindanao. The proposed hike is expected to rake in some P35 billion for the state-owned firm.
Timpuyog spokesman Melany Victoria said the impending rate hike "could cause further economic displacement due to industrial and business slowdown especially in the countryside."
Victoria also urged the National Association of Electricity Consumers for Reforms (Nasecore) to join the united front against the planned Napocor rate hike "in order to further strengthen the consumers’ position on the issue."
Victoria expressed hope that Nasecore would join consumers nationwide on this particular opposition. We understand that Nasecore has not been particularly aggressive against Napocor but we hope it would take the consumers’ side just this once, she added.
Victoria said the group is "optimistic that Nasecore would join the opposition to the Napocor petition in this particular instance since the implications of the planned rate hike to consumers are grim."
The group said the Napocor petition comes too close to the provisional rate hike authority given by ERC last year for an average P0.98 per kilowatthour increase. The group had earlier questioned the failure of Napocor to explain the details of the increase. The general excuse that Napocor needs to cover oil and other operating expenses is no longer acceptable, the group added.
The planned hike would also further underscore the fact that Napocor power, upon which most provinces are dependent, is more expensive than power supplied by independent producers, the group explained.
Timpuyog also called attention to the $ 400-million loan recently obtained by Napocor which were all guaranteed by the national government. The group said the loan is expected to further increase the contribution of the power generator to the national budget deficit.
The group recalled that the national government had already absorbed P200 billion of Napocor’s debts during the incumbency of former energy secretary Vincent Perez.
Perez "sweet-talked the public into accepting the debt absorption on the promise that Napocor will be privatized and that there would soon be an end to foreign borrowings and rate hikes," the group pointed out.
The group expressed concern that the continuing borrowings and rate hikes "could further stall the privatization of the ailing power firm."
The group urged Nasecore "to join the clamor for the speedy implementation of the Napocor privatization program". We are hope Nasecore realizes that only when Napocor is privatized will consumers truly have the power of choice and competition established in the power sector, the group added.
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The Philippine Star
05/26/2006
The Power Sector Assets and Liabilities Management Corp. (PSALM) has junked YNN Pacific Consortium Inc.’s proposal to attach a bilateral power supply contract to its $14-million performance bond.
PSALM vice president for asset management and electricity trading Froilan Tampinco said the PSALM board rejected YNN’s proposal as this will go against the privatization sales agreement.
"The performance bond is unconditional. YNN tried to request for the inclusion of a bilateral power supply contract as an additional condition to drawing the same by PSALM," Tampinco said. "However, we did not agree to this since this is contrary to the terms of the asset purchase agreement between YNN and PSALM."
Tampinco said PSALM has received from YNN, the winning bidder for the 600-megawatt Masinloc coal-fired power plant, the $14-million performance bond required after extending the deadline from March 31 to June 30 to deliver the $227-million upfront payment, rentals and option price.
March 31 was the original deadline set by PSALM for YNN to deliver the upfront payment and June 30 was the first extension given.
YNN submitted the first $14-million performance bond within the period prescribed by PSALM as a condition to the extension. With the inclusion of the bilateral contract with the Manila Electric Co. as an additional condition, PSALM rejected the earlier bond and demanded a revised one which YNN complied with.
"PSALM now possesses the acceptable performance bond," Tampinco said. "While the discussions were going on, the original $11-million bond remained effective and in PSALM’s possession so the government’s interest was amply protected," he added.
Tampinco said PSALM believes its move will be of best interest for the government. "It is still in the best interest of the government that PSALM give this transaction as much leeway to succeed. The bid of YNN is one that is difficult to duplicate should PSALM call for a rebidding prior to the deadline," he said.
"By just granting a few months extension, PSALM is simply mindful of its mandate to maximize proceeds for the government. Meanwhile, Masinloc continues to operate and generate revenues for the National Power Corp." he said.
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The Philippine Star
05/26/2006
The National Government saved P199.2 million in fuel and electricity costs over a five-month period until February 2006, the Department of Energy (DOE) reported yesterday.
The DOE said the savings were realized by 71 government agencies due to strict compliance to the energy conservation measures imposed by Malacañang.
Based on actual inspections conducted by the energy audit team headed by Senior Deputy Executive Secretary Waldo Q. Flores and Energy Undersecretary Peter Anthony Abaya during the September 2005 to February 2006 period, P190.5 million in savings were due to lower electricity consumption while an additional P8.7 million in savings resulted from lower fuel requirements.
These savings were achieved due to strict compliance to electricity and fuel conservation measures such as efficient lighting and cooling, judicious use of office equipment and elevators, efficient vehicle dispatch and maintenance and use of coco-biodiesel.
The agencies which achieved the highest savings level are Bangko Sentral ng Pilipinas, Office of the President, Land Bank of the Philippines, Department of Public Works and Highways (DPWH) and the Government Service Insurance System (GSIS).
Other agencies which achieved significant savings include Development Bank of the Philippines (DBP), Philippine Economic Zone Authority (PEZA), Department of Energy (DOE), National Power Corp. (Napocor), National Printing Office and the Social Security System (SSS).
Last year, President Arroyo issued several administrative orders to stave off the extraordinary increases in oil prices in the world market.
President Arroyo signed AO 126 which mandates government agencies to discontinue the use of airconditioning facilities especially during the cooler months from August to February where adequate ventilation is available.
Under AO 126, government agencies’ airconditioning units should be switched on not earlier than 9 a.m. and switched off not later than 4 p.m.
AO 126 further mandates efficient vehicle dispatch and maintenance. Improper vehicle maintenance causes smoke belching thus results in a very inefficient use of fuel and adversely impacts on the environment.
AO 103, on the other hand, authorizes the installation and use of energy-saving lights and fixtures to reduce electricity consumption.
"We are very pleased with our government agencies’ efforts to conserve electricity and fuel. We encourage low-performing agencies to redouble their efforts in changing their energy consumption patterns and strictly adopt our enercon measures and practices to further generate more savings and lessen our contribution to the country’s oil imports", Energy Secretary Raphael P.M. Lotilla said.
Mrs. Arroyo created the energy audit team or enercop to help put direction and focus on the government’s collective effort to conserve energy. The team was tasked to conduct on-the-spot checks in government agencies and offices.
The Chief Executive likewise issued Memorandum Circular 55 which directs all departments, bureaus, offices and instrumentalities of the government, including government-owned and controlled corporations, to blend one percent by volume coconut methyl ester (CME) in their diesel requirements.
Based on the testimonies of 80 government agencies that complied with MC 55, vehicles running on one percent CME-blended fuel confirm previous test findings that CME improves engine performance, promotes mileage efficiency and reduces vehicular emissions.
Out of the 80 government agencies with a total of 1,150 diesel fueled vehicles which submitted utilization reports on MC 55, 50 to 60 percent experienced average mileage increase of 1.11 kilometers per liter. Visible smoke was visibly reduced with CME utilization, with 80 percent of the agencies reporting "lighter" emissions from their vehicles.
Meanwhile, eighty percent of those who submitted their utilization report noted improvements in their engines’ emissions and observed that their engines were easier to start, while 76 percent reported faster acceleration of their vehicles running on CME.
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Manila Bulletin
May 25, 2006
Utility firm Manila Electric Company (Meralco) was granted a certificate of public convenience and necessity (CPCN) for the provision of electricity service to customers in Tiaong, Quezon and San Pablo City, Laguna.
As prescribed, a CPCN has to be secured by a utility firm from the Energy Regulatory Commission (ERC) before it can construct an electric substations or distribution lines in an area that is covered by its franchise; or if it has to set some modifications in its service in a particular domain.
This is different from a franchise, of which issuance, is a sole jurisdiction of Congress as provided under the Electric Power Industry Reform Act.
In its ruling, the ERC noted that "after a thorough evaluation of the documents and testimonies of witnesses presented, the Commission found that Meralco met all the requirements for the issuance of CPCN." The CPCN will be effective until June 28, 2028.
It has been indicated in its application that Meralco serves Tiaong, Quezon via two 34.5 kilovolt and one 6.24 kV primary distribution circuits sourced from the San Pablo 1 and San Pablo 2 substations.
The company also lined up two major electrical capital projects for a ten-year spread for the development of both Tiaong and San Pablo.
"Based on the documents submitted and the testimonies of the witnesses, Meralco was found to have the technical expertise, capability and resources to adequately and reliably serve the subject areas’ future electrical power needs," ERC noted.
On June 9, 2003, Congress has renewed Meralco’s franchise "to construct, operate and maintain a distribution system for the conveyance of electric power to the end-users in the cities/municipalities of Metro Manila, and the adjacent provinces of Bulacan, Cavite and Rizal; and in some cities, municipalities and barangays in the provinces of Batangas, Laguna, Quezon and Pampanga for a period of 25 years from June 28, 2003 or until June 28, 2028. (MMV)
The utility firm currently provides electric services to the 17 cities and municipalities in Metro Manila; 24 in Bulacan; and 23 in Cavite.
In its other jurisdictions, it is providing electric service in 14 cities and municipalities in the province of Rizal; three cities and municipalities in Batangas; 19 in Laguna; 11 in Quezon and 2 barangays in Apalit, Pampanga and one in San Simon, Pampanga; and 14 in Candaba town.
Meralco remains the biggest electric distribution utility in the country covering at least 70-percent of customers in the Luzon grid.
Despite difficult financial straits it went through, company officials vowed that they will strive hard to be in the forefront of delivering the country’s electricity needs. (MMV)
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Manila Bulletin
May 25, 2006
The need to secure a supply contract with Manila Electric Company (Meralco) has been weighed by the Power Sector Assets and Liabilities Management Corporation (PSALM) as a significant factor for the successful conclusion of the Masinloc deal.
However, the asset liquidation firm noted that it could only help winning bidder YNN and new partner, Malaysian Ranhill Power Bhd, to secure a supply deal; but this is not being made as a condition for them to deliver their commitments in the turnover of the asset.
PSALM was scheduled to meet late in the afternoon yesterday (May 23) to decide on the fate of the amended letter of credit (L/C) submitted by YNN Ranhill.
It has been previously reported that the asset purchasers have inserted a condition in the L/C that the -million performance bond would only be rendered effective if a supply contract with the giant utility firm can be secured.
The increase in the bond was set as a condition for the new deadline extension granted by PSALM for the asset buyers to put up the required upfront payment of $ 227 million. The original performance bond amount was $ 11.2 million.
However, company vice president for asset management and electricity trading group Froilan A. Tampinco noted that when the 600-megawatt Masinloc coal-fired facility was auctioned off in December 2004, "all bidders were aware that no supply contract was attached to it – it was offered as a merchant plant."
Given such circumstances, PSALM noted that YNN and Ranhill would have to undertake aggressive marketing effort just to corner buyers for the output of the facility.
"The supply contracts with Meralco or with major electricity users are important as these will assure a committed market for the electricity that the Masinloc plant will generate," Tampinco stressed.
The prospects of commercial operation for the Wholesale Electricity Spot Market (WESM), hopefully by next month, is also seen as alternative market for buyers of the generation assets of the National Power Corporation. PSALM though stressed that "it did not offer any guarantee."
The decision for a rebidding of the facility, the company admits, would be a tough process because prospective buyers might also bat for a supply contract.
YNN-Ranhill is expected to deliver its initial payment by June 30 this year. In this course, they have tapped ABN-AMRO to raise their much-needed cash.
As the transaction moves forward, the buyers are also talking with the Private Sector Operations Department of the Asian Development Bank (ADB) for project financing and possible equity investment.
"Prior to the decision to extend the deadline for the delivery of the upfront payment, PSALM met with the officers of ADB’s public sector and private sector departments to find out the process and check the feasibility of the arrangements being proposed by YNN-Ranhill. These issues were addressed to the satisfaction of PSALM," Tampinco said.
The Masinloc asset sale should have been the first big-ticket privatization endeavor of PSALM until it was saddled with some dilemmas. (MMV)
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The Philippine Star
05/25/2006
At least eight oil exploration firms have submitted firm proposals for the development of the Camago-Malampaya oil leg (CMOL), a top Philippine National Oil Co. (PNOC) official said.
In a press conference, PNOC president and chief executive officer Eduardo Mañalac said while 16 entities were invited to bid by the PNOC, only eight firms have responded positively.
The prospective partners in CMOL, he said, are: Ability Group of Norway; Argo/Mitra Group; Burgundy Global Exploration Corp.; M3Nergy of Malaysia; Premiere Oil of UK; Pearl/Pitkin of Singapore; Vanguard Oil and Gas Development of UK; and Synergy International of China.
Mañalac said PNOC is currently reviewing the proposals and will decide on whose proposal they will consider soon.
"We have received their proposals and we are evaluating it now. We plan to finish the evaluation, and make the choice of our partner by the end of the month," he said.
The PNOC chief said they would try to work out an agreement with one of these groups or form a consortium with these potential partners.
"Partnering with a number of them is something we are looking at as well. We are considering each of the companies’ strength and equipment, with the notion that we want to drill for oil first before the end of the year," he said.
He said what they want assurance that the chosen firm or consortium could deliver on CMOL’s drilling requirements.
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The Philippine Star
05/25/2006
The state-owned Philippine National Oil Co. (PNOC) is negotiating a coal mining contract in Indonesia, a ranking company official said.
"One of the new developments is our plan and decision to mine coal in Indonesia," PNOC president and chief executive officer Eduardo Mañalac said in a a press conference.
Mañalac said they are in the process of firming up a mining contract with one of Indonesia’s coal mining companies.
"We are currently undergoing negotiations with PT Putra Asyano Mutiara Timur to develop mine and sell coal from its Ampah coal concession located in central Kalimantan, Indonesia," he said.
Initially, he said PNOC has confirmed 12.5 metric tons of high quality coal reserves over a 300-hectare area from the 5,000-hectare Ampah concession.
Upon completion of all development work, he said PNOC plans to start full mining operation by the first quarter of next year.
Mañalac said PNOC’s move to tap Indonesia as one of the potential partners for coal mining efforts is prompted by the Philippines’ need for a ready supply of coal.
"This effort would help us make sure, since this coal would be exported to the Philippines, that we have sufficient supply of coal. It’s not that we are not exploring here, it’s because the large coal reserves we have in the country are of low quality coal. We went there since we need high quality coal to blend with local coal," he said.
The Malangas coal, the kind of coal that is being produced here in the Philippines, is used to blend and raise the quality of the other coal.
"We would mine and sell the coal to be extracted and pay them instead. We would develop it when we prove it is economic, and then we would negotiate a development agreement," he said.
He said they expect to expand the coal mining venture with other Indonesian mining firms if the agreement with PT Putra becomes successful.
"The 12.5-million metric ton is just in the 300-hectare, not all of it would be sold as it would be used to be blended with local coal. Our customers are LaFarge, Holcim, and National Power Corp. (Napocor)," he said.
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The Philippine Star
05/24/2006
The Aboitiz Group has expressed interest in bidding for the power requirements of the economic zones under the Philippine Economic Zone Authority (PEZA), a ranking company official said.
"We’re very keen on doing that. We are hoping that PEZA Director General Lilia de Lima will look at bidding out some of the power requirements of the PEZA-zones," said Aboitiz Equity Ventures (AEV) chief operating officer Erramon Aboitiz.
He said they have met with De Lima and presented the milestones achieved by AEV’s subsidiary Subic EnerZone Corp. (SEZ) at the Subic economic zone.
SEZ is a consortium composed of AEV, Davao Light & Power Co. (DLPC), San Fernando Electric Light & Power Co. (SFELAPCO) – two of AEV’s subsidiaries – and Mirant Phils. Corp.
SEZ was contracted to provide power distribution services to the Subic Bay Metropolitan Authority (SBMA) from 2003 up to 2028. The company pays SBMA P40 million annually for the lease of power facilities and other properties. To date, SEZ has paid a total of P120 million.
According to Aboitiz, they assured the PEZA chief of AEV’s efficiencies in lowering the cost of power and further bringing down their systems loss.
SEZ’s systems loss was brought down to about 6.86 percent to date from 15 percent when it took over SBMA’s power distribution utility in October 2003. With the systems loss reduction, SEZ customers achieved a 14.5 centavos per kilowatthour savings on their electricity consumption.
"We were able to cut power costs by 50 centavos per kwh. We have improved electricity service at SBMA," he said.
In 2003, SEZ committed to invest P350 million over five years to improve Subic’s power distribution system. It has so far invested P200 million with plans of investing another P50 million early this year.
Meanwhile, Aboitiz lauded the Energy Regulatory Commission’s initiative to provide incentives to distribution utilities that are able to lower their systems loss.
"We welcome that very much. At the end of the day, power projects require investments. It is always good to give incentives to people," Aboitiz said.
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Manila Bulletin
May 22, 2006
Enticed with the offer of competitively-priced electricity, at least 45 of the country’s biggest industrial customers have sought direct connection with the state-owned National Power Corporation, its marketing and commercial department has reported.
Already in the roster of bulk power accounts of the power utility are San Miguel Corporation, Ayala Land, Inc. and SM Super Malls, among others. The calculated total requirements of the 45 industrial applicants was placed at 214,660 kilowatts.
The other big-ticket power users seeking direct connection are Camp John Hay Special Economic Zone in Baguio City and Ammex Corporation in Benguet for a demand of 20,000 kW each.
The others are Samsung Electro Mechanics in Calamba, Laguna for 10,630 kW; Climax Arimco Mining Corporation in Nueva Vizcaya for 15,000 kW; and Crew Minerals, Inc. and Platinum Metals Corporation for 10,000 kW of demand each.
"This is an indication of the business sector’s strong confidence in the NPC’s ability to provide adequate, reliable and competitively-priced power supply," the company has noted.
Its directly-connected customers reportedly brought in additional revenue of P270 million for the state-run power firm last year.
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The Philippine Star
05/23/2006
National Transmission Corp. (TransCo) has appealed to the Energy Regulatory Commission (ERC) to approve its application for a certificate of authority as a metering services provider for the country’s wholesale electricity spot market (WESM).
"We need to install meters in both the generation and distribution sides to successfully operationalize retail competition, and this takes time. We appeal to ERC to approve our request submitted in January 2005," TransCo president Alan T. Ortiz said.
Ortiz has underscored the central role ERC plays in open access and retail competition.
"ERC is the fulcrum, the holder of the balance, the facilitator of the entire energy industry restructuring. At this point, the success or failure of retail competition rests entirely on the ERC."
Ortiz also noted the need for the final determination of TransCo’s maximum allowable revenue (MAR) to be investor-friendly and conform to the requirements of the global investing community.
"We hope the final determination of our MAR will be investor-friendly because if not, we will go back to square one, with government operating the transmission assets and incurring more debts for new transmission projects needed to cope with ever-rising power demand," Ortiz said.
Earlier, heads of government energy agencies commended ERC’s initiative to speed up the opening of the electricity spot market even as they stressed that retail competition is a critical ingredient in achieving the goal of EPIRA of providing reliable, affordable electricity.
During the public consultation on the proposed timeline for full retail competition, Energy undersecretary Melinda Ocampo lauded ERC for taking the lead in ensuring the successful restructuring of the energy industry.
Philippine Electricity Market Corp. (PEMC) president Lasse Holopainen, for his part, said PEMC is currently undertaking aggressive measures to promote the full participation of electric cooperatives in an open access regime.
"We are well on our way, so we hope that tariff and regulatory issues raised by the coops will be addressed fully by the ERC," Holopainen said.
Holopainen said he supports TransCo’s appeal to hasten the approval of Transco’s sub-transmission divestment contracts with electric distributors as this will empower the latter with the financial muscle to provide more efficient and reliable service to end-consumers.
National Power Corp. (Napocor) president Cyril del Callar, meanwhile, underscored the need for a complete Ancillary Service Procurement Plan (ASPP).
"This will encourage the signing of more bilateral contracts between generators and distributors, which will in turn promote our common goal to reflect the true cost of electricity," Del Callar said.
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The Philippine Star
05/23/2006
The National Power Corp. (Napocor) said a total of 45 industrial and commercial bulk-power users – including San Miguel Corp. (SMC), Ayala Land Inc. (ALI) and SM Supermalls – have applied for direct power connections with the state-run power firm.
Napocor president Cyril del Callar said this indicates the business sector’s growing confidence in the firm’s ability to provide adequate, reliable and competitively-priced power supply.
In a report, Napocor’s Marketing & Commercial Relations Department (MCRD) said the 45 applicants combine for an estimated 214,660 kilowatts (kw) of power requirements.
In the case of SMC, it is seeking a supply of 19,000 kw for its food processing plant in Mandaue City, Cebu and another 3,000 kw for its recycling plant in Mindanao.
ALI, on the other hand, needs 15,000 kw for the Laguna Technopark, while SM requires a combined 5,500 kw for its malls in Gen. Santos and Ozamis City, both in Mindanao.
The MCRD report said 19 of the interested customers are located in Luzon, while 18 are based in Mindanao. The remaining eight are from the Visayas.
According to Napocor, the applicants represent a broad range of power-intensive industries, but most are involved in mining, electronics, steel manufacturing, and food manufacturing.
It said the other companies operate economic zones, industrial estates, and universities, while a handful represent local government offices.
Other companies that want to be directly connected to Napocor include Camp John Hay Special Economic Zone in Baguio City and Ammex Corp. in Benguet, which have a demand of 20,000 kw each; Samsung Electro Mechanics in Calamba, Laguna (10,630 kw); Climax Arimco Mining Corp. in Nueva Vizcaya (15,000 kw); and Crew Minerals Inc. and Platinum Metals Corp., both located in Mindanao (10,000 kw each).
Napocor also reported that six new customers were energized in 2005, namely, Global Steelworks International Inc. (formerly National Steel Corp.) in Suarez, Iligan City; the Philippine National Oil Co. – Energy Development Corp. facilities within the Bacon-Manito and Palinpinon complexes; the People’s Energy Services Inc. in Camarines Sur; the LIDE (Leyte Industrial Development Estate) Management Corp. in Isabel, Leyte; Treasure Steelworks Corp. in Nunucan, also in Iligan City; and Purity Ice Plant & Cold Storage Inc., in Labo, Camarines Norte.
The MCRD report said these new customers contributed P270 million in additional revenues for Napocor in 2005.
A seventh customer, the Rosales Ice Plant in Pangasinan was given a power supply contract in 2005, but has yet to be energized.
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