PSALM privatizes expensive assets

Lorraine Alberto, Micole Vergaño | January 24, 2018

Photo from PILILLAONLINE.COM

The Power Sector Assets and Liabilities Management Corp. (PSALM) has finally decided to privatize expensive assets this year, including the 650-megawatt Malaya thermal power plant in Rizal and the 210-MW Mindanao coal-fired plant in Misamis Oriental.

PSALM wanted to pull out on operational costs and increase funds for paying off the financial necessity that they need to do the plan from the cash-strapped National Power Corp.

“PSALM will seek its board’s definitive policy on the privatization of Malaya (plant) and Mindanao (plant),” the state firm said, noting that the sale of both facilities had been previously put off.

The bidding that happened last year of the four-decade-old Malaya plant was cancelled due to the conversion of the oil-fired facility into one that would run on liquefied natural gas that was considered by the Department of Energy (DOE).

“PSALM has yet to receive a final word from the DOE on the natural gas policy, which will be included in the plant’s sale terms of reference,” the state firm said.

The privatization of Mindanao plant that was planned in 2015 was delayed due to improper timing and has a problem regarding to the oversupply of generating capacity and the plant might not attract the maximun investment.

As to support PSALM’s cash position, 231 parcels of land that sums up to total area of 10,00 hectares would be prioritized for the privatization of non-power assets.

This month, eight lots that has a total of 20, 975 square meters belonging to the Manila thermal plant complex, and the 92 lots with a total of 257,995 square meters which belongs to the Bauang diesel power plant in La Union are already lined up for public bidding.