MANILA, Oct. 1 (PNA) — The Power Sector Assets and Liabilities Management (PSALM) Corporation on Thursday (25 September 2014) turned over the 153.1-megawatt (MW) Naga Power Plant to its new owner, SPC Power Corporation.
“Effective 10:00 a.m. on 25 September 2014, coinciding with the lapse of the Operation and Maintenance Service Contract (OMSC) of the Naga power facility, SPC is the new owner and operator of the Cebu-based power facility,” said PSALM President and Chief Executive Officer Emmanuel R. Ledesma, Jr.
Mr. Ledesma said PSALM and SPC held the closing of the Naga plant on 23 September 2014 in Makati City during which the two companies exchanged their closing documentary deliverables in simple ceremonies.
PSALM conducted the bidding for the Naga power plant on 31 March 2014, wherein Therma Power Visayas Inc. emerged as the highest bidder with its bid of Php1.09 billion (Php1,088,800,000.00), and SPC as the second bidder at PhP859 million (Php858,999,888.88).
However, the condition of the sale provides that SPC has the “right to top” the price of the winning bidder for the Naga plant by 5 percent, as provided under the Land Lease Agreement executed between PSALM and SPC for the Naga Land-based Gas Turbine in 2009.
On 20 May 2014, SPC wire-transferred to PSALM’s account a total of Php1.14 billion (Php1,143,240,000.00), which is five percent higher than the Php1.09-billion offer of Therma Power.
On 30 July 2014, PSALM issued the Notice of Award (NoA) and the Certificate of Effectivity (CoE) to SPC together with one original executed copy of the Final Transaction Documents, which consisted of the Asset Purchase Agreement (APA) and the Land Lease Agreement (LLA) for the sale of the Cebu-based power plant.
The award was in accordance with the decision of the PSALM Board of Directors in its meeting on 25 July 2014.
“The CoE prompts SPC to fully comply with and complete all the conditions for the closing of the sale of the Naga Power Plant,” Ledesma previously explained.
He added that, SPC, for its part, delivered on 08 August 2014 its performance bond, which is required upon effectivity of the APA and valid until the date of the turnover.
The Naga Power Plant consists of the 52.5-MW Cebu 1 and 56.8-MW Cebu 2 coal-fired thermal power plants, and the 43.8-MW Cebu Diesel Power Plant 1 composed of six 7.3-MW bunker-C fed power units.
Specifically situated in Colon, Naga City, Cebu, these power plants use a combination of coal, bunker C oil, and diesel as fuel. (PNA)