SMC, K-Water take First Gen into Angat hydropower project
Diversified conglomerate San Miguel Corp. (SMC) and Korea Water Resources Development Corp. (K-Water) have picked a member of the Lopez Group as partner as they push forward with plans to rehabilitate and operate the 218 megawatt component of the 47-year-old, 246-MW Angat hydroelectric power plant in Norzagaray, Bulacan.
Four years since the tender for the power facility, arrangements for the privatization of the power facility have been ironed out, SMC president Ramon S. Ang told reporters on the sidelines of the stockholders’ meeting of Petron Corp. in Pasig City.
Asked who the other Filipino partner is, Ang said, “Piki Lopez.” He was referring to First Gen Corp. chairperson Federico R. Lopez.
“It’s all ok now, the local issues have been settled. Psalm (Power Sector Assets and Liabilities Management Corp.) and the local government have settled issues,” Ang said.
As to the sharing, Ang said each of the Filipino partners may have 30 percent share, which may leave K-Water with 40 percent.
Ang declined to comment when asked when definitive agreements will have been signed, saying only that the facility may be turned over to K-Water next month.
“When K-Water comes in, we’ll join in,” Ang said. Asked if this could take place next month, he said, “I’m sure.”
Last year, SMC said its board of directors had authorized management “to discuss, negotiate, and to enter into a joint venture with (K-Water), under terms and conditions favorable to the company, to create an entity to undertake the administration, rehabilitation, operation and management” of the Angat hydroelectric power facility.
Having Filipino partners would enable K-Water to hurdle foreign ownership restrictions on the ownership of utilities in the Philippines.
The 218-MW hydroelectric power plant is fueled by water from the Angat dam, which supplies irrigation to farmlands in Bulacan and provides more than 90 percent of Metro Manila’s potable water supply.
In the April 2010 tender for the 218-MW component of the Angat power plant, K-Water bested the offers of some of the biggest power players in the country: First Gen Northern Energy Corp., San Miguel Corp., SN Aboitiz Power-Pangasinan Inc., Trans-Asia Oil and Energy Development Corp., and DMCI Power Corp.
The government ran into trouble turning over the facility to the Korean state-owned firm after non-government organizations challenged the sale. The Supreme Court has since allowed the privatization but told K-Water to take on a Filipino partner.
The remaining 28-MW component of the Angat power facility remains under the control of the Metropolitan Waterworks and Sewerage System (MWSS), which has yet to privatize the rehabilitation, maintenance and operation of the facility’s Auxiliary Units 4 and 5. Their combined output is 28MW.
