3rd party auctioneer offers to handle bidding for Napocor plants

The Power Sector Assets and Liabilities Management Corp. (PSALM) has received offers for third party auctioneer (TPA) services for the sale of the decommissioned plants of the National Power Corp. (Napocor).

PSALM vice president for asset management and electricity trading Froilan A. Tampinco said three firms have already submitted their respective proposals for the TPA services "even while the terms of reference are still being finalized."

While declining to identify the firms, Tampinco said the engagement of a TPA would nevertheless be done through a public bidding.

Noting that it took much time disposing of the retired plants of Napocor, PSALM decided to hire the services of a TPA as an alternative strategy in the auction of these decommissioned facilities.

According to Tampinco, the plan to tap a TPA was approved by the PSALM board.

"Professional auctioneers who have a broad network of clients both here and abroad can tap more players for the bidding exercises for Napocor’s decommissioned plants," Tampinco pointed out.

Under the terms of reference, the main function of the TPA, who will provide a comprehensive asset disposal service to PSALM, involves formulating an appropriate sale strategy and methodology for the decommissioned power plants. These include the administration of an inventory of the assets, the preparation of the assets, the strategic conduct of the auction, and the removal of the assets from their respective sites.

Napocor currently has at least five retired plants in its portfolio: the 225- megawatt (MW) Bataan (bunker), the 54-MW Cebu II (diesel), the 200-MW Manila (bunker), the 22.3-MW General Santos (diesel), and the 108-MW Aplaya (diesel) power plants.

By engaging the services of a TPA, PSALM hopes to gain ground in selling these decommissioned power facilities, three of which had unsuccessful bidding exercises in 2005.

The Bataan thermal plant, which is scheduled for a negotiated sale this year, suffered two rounds of failed biddings in April and September last year.

The auctions for both the Cebu II and Manila plants held in the first quarter of 2005 were also declared as failures.