Aug. 6--At least four companies are vying for state-owned National Power Corp.'s (Napocor) contracted output with the Pagbilao and Sual coal-fired power plants, which will be auctioned off this month.

An industry source said the investors include San Miguel Corp. (SMC), which earlier submitted a bid for the facilities' capacities. However, the conglomerate is still evaluating its move, the source added.

The Aboitiz Group, which also bid for the Pagbilao and Sual coal contracts during the first round, has also expressed interest to join the auction again.

The source did not name the other interested firms.

The Power Sector Assets and Liabilities Management Corp. (PSALM), which is tasked to privatize Napocor's assets, launched the second round of bidding for plants' capacities, which are rated at 1000-megawatts and 700-megawatts, respectively.

The first auction held in June failed because SMC and the Aboitiz Group did not meet the reserve price set by the government.

San Miguel Corp. offered $1 billion for the Sual and $590 million for the Pagbilao contract. The Aboitiz Group, through its unit Therma Luzon, offered $812.95 million and $648.80 million, respectively, for the said plants.

PSALM earlier said that if the bidding would fail again, then it would have to enter into negotiations with interested parties.

The two power plants are located in Pangasinan and Quezon province, respectively. Both are operated by TeaM Energy, a joint venture between Japanese firms Tokyo Electric Power Co. and Marubeni Corp., under build-operate-transfer contracts that will expire in 2024 and 2025.

The facilities are included in the first batch of Napocor's contracted independent power producer (IPP) outputs to be put in the auction block. The privatization of at least 70 percent of these assets would complete the Electric Power Industry Reform Act of 2001 and would usher in an era of open access and retail competition in the power sector.

This will allow consumers, starting with bulk end-users such as industries and power distribution utilities, to choose where they source their electricity supply.

The 1,700-megawatt aggregate contracted capacities of the Sual and Pagbilao power plants represent around 34.7 percent of the contracted capacity of Napocor's IPP contracts for Luzon and the Visayas.

-----

To see more of The Manila Times, or to subscribe to the newspaper, go to http://www.manilatimes.net.

Copyright (c) 2009, The Manila Times, Philippines

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

Philippines:SMCB, RTS:SMCR, Tokyo:9501, OTC-PINK:MARUY,

A service of YellowBrix, Inc.