NG resets anew TransCo bidding

The Power Sector Assets and Liabilities Management Corp. (PSALM) has rescheduled for the fourth time the bidding for the National Transmission Corp. (TransCo) to Jan. 22, 2007, a ranking Finance official said.

"The PSALM board has scheduled the bidding of the 25-year concession of TransCo on Jan. 22, 2007 instead of Dec. 20, 2006," Finance Secretary Margarito Teves told reporters yesterday during the stock market listing of PNOC-Energy Development Corp.

Teves said this was intended to give prospective bidders ample time to raise their concerns on TransCo’s privatization procedures.

"We have decided that it will give the bidders more time to review and ask clarifying questions related to the consent," he said.

A few days ago, PSALM has already hinted the possibility of extending anew the bidding schedule for the 25-year concession contract of TransCo.

PSALM president Nieves Osorio said they have decided to give the prequalified bidders of TransCo "a third opportunity to comment on and clarify the amendments, revisions and modifications in the bidding procedures before the bid transaction documents are finalized."

"Due to numerous and complex issues raised by all the prequalified bidders during the second round of comments, PSALM decided to open another window of opportunity for the bidders to clarify their concerns," Osorio said.

She added that "PSALM has yet to decide whether or not to push the scheduled public bidding to a later date."

According to Osorio, the final transaction documents are crucial as these are the execution versions of the bid transaction documents that incorporate the comments of the investor groups. These include the direct agreement and the concession agreement.

"The Privatization, Bids and Award Committee will evaluate the implications of the suggestions made and amendments proposed by the prequalified bidders," Osorio said.

The PSALM chief also said it is the sole discretion of the committee to accept the suggestions and/or amendments it considers relevant."

A draft of the transaction documents incorporating the modifications and revisions approved by the PSALM Bids and Award Committee, Osorio said, would be made available to the bidders.

She also noted that "the changes in the timetable will be communicated to the prequalified bidders through a supplemental bid bulletin."

The three prequalified groups vying for the concession of the country’s sole transmission arm are the consortium of Triratna Holdings Corp., Tenaga Nasional Berhad and Newbridge Asia IV L.P.; the consortium of Citadel Holdings Inc. and Terna SpA; and the consortium of Monte Oro Grid Resources Corp. and State Grid Corp. of China.

The series of typhoons that damaged hundreds of transmission lines of TransCo is also being perceived as one of the reasons for the apprehension of the prospective bidders.

TransCo reported that it would need more than P1 billion to rehabilitate the damaged transmission poles and lines. For typhoon Reming alone, TransCo would need some P800 million for the rehabilitation and/or replacement of the toppled transmission lines.

The government is hoping to raise between $2.5 billion to $3 billion from the lease agreement of TransCo.