AEV, SN Power tie up for Magat plant bid

Aboitiz Equity Ventures Inc. (AEV) and SN Power of Norway will jointly bid for the 360-megawatt (MW) Magat hydroelectric power plant in Isabela.

The two are among the 13 groups of investors interested in bidding for the Magat plant, the Power Sector Assets and Liabilities Management Corp. (PSALM) said. Other interested investors are Korea Electric Power Corp. (Kepco) and United States-based CalEnergy.

PSALM is the government agency that will handle the sale of the power plant. Bidding will reportedly be held next month.

PSALM officials said they are optimistic the Magat sale would easily be consummated much like the enthusiasm the private sector showed in the Pantabangan-Masiway sale.

PSALM vice president Froilan A. Tampinco said that they have already resolved operation and maintenance (O&M) issues as it is covered by an agreement between PSALM and the National Irrigation Administration (NIA). PSALM also plans to attach a supply contract of between 10 to 15 percent on the sale.

The winning bidder for the Magat plant will have a ready market for its 36 megawatt to 54 MW output through a supply contract either with the National Power Corp. (Napocor) or a distribution utility.

The Magat hydroelectric plant, located in Ramon, Isabela, serves the primary functions of power generation and irrigation. It was built at a cost of $83.7 million. Construction period started in 1980 and commercial operation came three years after in 1983.

AEV and SN Power attempted to acquire the 112-MW Pantabangan-Masiway power facilities in a bidding last Sept. 8 but lost out to First Generation Corp. which offered $129 million for the power plant. The Aboitiz/SN Power venture offered $112 million for the facility.

Two of AEV’s subsidiaries are engaged in power generation and distribution through utilities such as the Visayan Electric Cooperative (VECO) and the Davao Light and Power Corp. (DLPC), respectively.