PSALM reduces selling price of 218-MW Angat hydro plant

MANILA, Philippines–State-run Power Sector Assets and Liabilities Management Corp. (PSALM) has reduced the selling price of the 218-megawatt Angat hydroelectric power plant in Bulacan to $439 million.

PSALM president and CEO Emmanuel Ledesma on Thursday confirmed that the price has been slightly reduced from the $440.88-million offered by Korea Water Resources Development Corp. (K-Water) during the PSALM bidding held in April 2010.

“The roughly $439-million reduced purchase price is a result of the capacity testing of Angat hydroelectric power plant’s main units 2 and 4, as provided under the asset purchase agreement,” Ledesma told reporters.

But he declined to disclose a specific timetable for the signing of the deed of sale and the turnover of the Angat facility to K-Water given that “there are pending issues that prevent the closing” of the sale.

It has been four years since the Korean firm, said to be the leading water resources and power firm in South Korea, bested five other companies in a PSALM bidding to privatize the Angat facility. Other bidders included some of the biggest power players in the country such as First Gen, San Miguel group and the Aboitiz group.

In 2010, K-Water submitted the highest offer for the Angat hydropower plant. But the bidding was questioned and blocked by various groups, thus delaying the awarding process.

It was only in 2012 that the Supreme Court rendered as valid and legal the sale of the Angat power plant to K-Water.

Last year, K-Water sought a reduction of the purchase price as the Angat hydroelectric power plant allegedly deteriorated from the time K-Water made a bid in 2010, due to PSALM’s failure to operate it over the years, the South Korean firm earlier said.

K-Power had also asked the government to pay P300 million worth of unpaid municipal property taxes by PSALM and state-run National Power Corp., stressing that these taxes would be a “severe burden to K-Water as the municipal government signaled difficulties in … [granting] permits and licenses until the taxes are fully paid.”–Amy R. Remo