Senators call for rebidding of Masinloc plant
Tuesday, July 18, 2006
By Roy Pelovello
Influential backers of YNN Pacific consortium are pulling the strings to force Manila Electric Co. into granting a guaranteed supply contract as a means to salvage the Masinloc power plant deal, Senator Sergio Osmeña III said yesterday.
Earlier, the government forfeited YNN’s $14 million performance bond for failing to meet the June 30 deadline within which it was to put up the $227 million down payment for the 600-megawatt coal fired power plant.
The senators urged the government to conduct a new bidding for the Masinloc power plant even after YNN got a new partner, the Malaysian firm Ranhill Berhad, to bail it out and be able to operate Masinloc.
Senate Minority Leader Aquilino Pimentel had taken the position that the entry of Ranhill Berhad into the picture should be considered as a new offer, noting that YNN’s asset purchase agreement prohibits the buyer from transferring its rights to another investor.
“The dummies claimed that although the security deposit has been forfeited, YNN has 30 days to execute the contract by paying the $227 million down payment. That is designed to give YNN time to sign a power supply contract with Meralco,” Osmeña said.
Likewise, Osmeña lashed at Economic Planning Secretary Romulo Neri who claimed that a flaw in the Epira (Electric Power Industry Reform Act), not the Power Sector Assets and Liabilities Management Corp., was to blame for the failed privatization.
“That’s way off the mark. Masinloc was bidded out as a merchant plant, meaning without a power supply contract because it has very low operating cost,” Osmeña pointed out.
The senator said YNN is to blame for its problems because it overbid for the Masinloc plant with $566 million when PSALM set the reserve price at a mere $388 million.
Osmeña said Neri is shifting the blame to defects in the Epira law because Bayan Muna has already filed a graft case against the PSALM officials for the bungled privatization of Masinloc power plant.
In saying that YNN has powerful connections helping it to salvage the deal, Osmeña recalled that it was Senator Juan Ponce Enrile who linked YNN’s Sunny Sun to former Napocor president Jesus Alcordo, who is now with the Energy Regulatory Commission.
posted by philpower @ 10:52 AM,
