Lopez Group bags Bacon-Manito plants

MANILA, Philippines - Lopez-owned Bac-Man Geothermal Inc., won the bidding yesterday for the 150-megawatt (MW) Bacon-Manito geothermal power plants with its offer of $28.25 million.

The Power Sector Assets and Liabilities Management Corp. (PSALM) said Bac-Man Geothermal’s offer bid for the Bicol-based geothermal plants topped the $17.8-million bid of the only other participant, Therma Power Inc., of the Aboitiz Group, although both bids exceeded the reserve price set by PSALM for the BacMan facilities.

The Lopez Group is among the most active participants in the government’s power privatization program program. First Gen Corp., its power generation arm, is the leading clean and renewable company in the country that uses indigenous fuels like geothermal and natural gas.

The Lopezes have successfully acquired five plant portfolios: the 1.6-MW Agusan and the 112-MW Pantabangan-Masiway hydropower plants, and the 305-MW Palinpinon-Tongonan geothermal power plant package.

The Bac-Man power plants are being supplied by the Bac-Man geothermal production field in Sorsogon operated by EDC, also owned by the Lopez Group.

The geothermal field, estimated at 25,000 hectares, covers the boundary of Legaspi City , Sorsogon City , Bacon District of Sorsogon City and the town of Manito Albay in the Bicol Region.

EDC president and COO Richard Tantoco said they are now finalizng the payment for the bid. We would be availing initially of the staple financing by PSALM but we may also pay the lump sum using our internal funds,” he said.

Tantoco said they would start assessing the condition of BacMan.

“The BacMan plants are not in good shape, so we would need about 24 months to have the whole plant running again. It would really need a major rehabilitatiion,” he said.

He said they would also try to enter into supply contracts for the power facility.

“No existing TSCs (transition supply contracts) with Napocor, so once we get the plant running, we’ll be going into bilaterals with Luzon customers,” he said.

The BacMan I geothermal plant consists of two 55-MW turbines, which were both commissioned in 1993. BacMan II, on the other hand, consists of two 20-MW units, called the Cawayan and the Botong.

The Cawayan, which is located in Bgy. Basud, was commissioned in 1994, while the Botong unit, commissioned in 1998, is in Osiao, Sorsogon City .

Adhering to its bidding policy, PSALM will formally declare Bac-Man Geothermal as the winning bidder for the BacMan plants as soon as it has verified the accuracy, authenticity, and completeness of the bidding documents that the company had submitted.

With the successful sale of the BacMan plants, PSALM’s privatization level has reached the 91.73-percent mark for all its generation assets in the Luzon and Visayas grids.

PSALM expects to complete the privatization of these assets this year.