Bidding for four power barges fails

MANILA, Philippines - The bidding for the of four state-owned power barges — the first privatization effort of the Power Sector Assets and Liabilities Management (PSALM) this year — failed yesterday as only one of seven qualified bidders submitted an offer.

A fresh round of bidding will be discussed, a move that will allow the power barges to increase available electricity in Mindanao, PSALM officials said.

 “The PSALM declared the bidding for Power Barges 101-104 a failure after only one of the seven qualified bidders submitted an offer for the assets,” the state-run firm said.

Only ACTA Power Corp., a joint venture between AC Energy Holdings Inc. of Ayala Corp. and Trans-Asia Oil and Energy Development Corp. of the Phinma Group, submitted the required bidding documents before the 12 noon deadline.

A bidding is considered a failure under PSALM’s rules when less than two firms participate in an auction.

Last month, PSALM delayed the bidding to May from the original April 13 schedule to give more time for interested firms’ due diligence. PSALM initially planned to auction off the power barges before the end of last year but was delayed due to a review.

Designed as base-load plants, PB 101, 102, 103 and 104 are nominal 32-megawatt (MW) barge-mounted, bunker-fired diesel generating power stations that consist of four identical Hitachi-Sulzer diesel generator units rated at eight MW each. The National Power Corp. (Napocor) bought the power barges from Japanese firm Hitachi Zosen Corp.

The government is looking to conduct a second round of bidding for the power barges.

“We are studying our options on bidding and on moving barges to Mindanao,” DOE Secretary Jose Rene Almendras said in a text message.

PSALM president and chief executive Emmanuel R. Ledesma Jr. said the plan for a new round of bidding will be taken up with the PSALM board.

“PSALM hopes to conduct the second round of bidding as soon as possible, subject to board approval,” the company said.

For its part, Trans-Asia said it will still participate in the next bidding.

“Yes, we are still interested in a rebidding, the sooner the better so it can be moved to Mindanao before summer of next year,” Trans-Asia president Francisco L. Viray said in a text message.

Under the bidding rules, winning firms should immediately transfer these power facilities in electricity-starved Mindanao and would have to stay there until 2014.

The power barges are movable and can be relocated anywhere with adequate mooring structures. Package 1 combines PB 101 and 102, Package 2 includes PB 103 and Package 3 covers PB 104.

Commissioned in 1981, PB 101 and 102 are stationed in Iloilo City while PB. 103 and 104, which began operation in 1985, are moored in Estancia, Iloilo and at the Holcim compound in Ilang, Davao City, respectively.

Since they began operation, these barges had been moved to various locations to meet technical requirements —usually a power shortage - or to provide reactive power support to improve voltage regulation at the end of very long transmission circuits.

In 2010, PSALM sold Napocor’s 100-MW PB 117 and 118 to Therma Marine Inc. of the Aboitiz Group for a total of $30 million, around a third of the appraised value of the assets.