Lanao del Norte Rep. Alipio Badelles said the government "has nothing to fear about the prospect of a new bidding."
"I know there are many local and foreign investors interested in that power plant. It is one of the newest plants of the National Power Corp.," he said in a radio interview over the weekend.
He said the Power Sector Assets and Liabilities Management Corp. (PSALM) should no longer extend the June 30 deadline it has given YNN Pacific Consortium, the winning bidder of the Masinloc plant.
He added that his committee would recommend the cancellation of the Masinloc sale contract if YNN failed again to comply with its financial commitment by the end of the month.
Last December, YNN committed but failed to deliver to the government $227 million, or 40 percent of its $562-million winning bid. The deadline was extended to last March and then again to June 30.
In exchange for the extensions, PSALM required YNN to increase its performance bond from $11 million to $14 million.
According to PSALM officials, they extended the payment deadline because the $562-million bid was difficult to match or obtain if a new bidding were conducted.
Badelles said the concerned officials would not know that unless they held a new bidding.
He said even if the YNN offer would maximize benefits to the government, it means nothing unless the winning bidder complies with its commitments.
Besides recommending the conduct of a new bidding once the June 30 deadline expires, the Badelles committee wants the government to confiscate YNN’s $14-million performance bond for "non-performance."
Two opposition congressmen, Rolex Suplico of Iloilo and Teodoro Casiño of Bayan Muna, have supported the committee’s planned recommendations.
"YNN has failed twice to deliver on its part of the bargain. If it fails again, the government should cancel the sale, confiscate the bond and conduct a new bidding for the Masinloc plant," Suplico said.
He said PSALM officials have a lot of explaining to do on why they are "too soft" on YNN.
Suplico is a member of the energy committee and represents the House minority bloc in the congressional power commission, the body that continually checks on the sale of assets of the state-owned National Power Corp. (Napocor) and the implementation of the law on reforms in the power industry.
For his part, Casiño said the failure of YNN to deliver to the government its initial payment "confirmed our worst fears that it does not have sufficient financial capability."
"We have to scrap this sale, which is so far the largest privatization of a Napocor plant and redo the auction again. The failure of the bidder to deliver on its promise does not augur well for the privatization program," he said.
He said PSALM should have already revoked the sale and confiscated YNN’s performance bond.
But instead of scrapping the sale and confiscating the bidder’s bond, PSALM extended the deadline twice, he said.
"What kind of a management do we have in PSALM? What has YNN Pacific offered them to deserve such an extension? Did they believe this four-month-old upstart company?" he asked.
He and other militant party-list representatives had filed Resolution 468 seeking an inquiry into the sale of the Masinloc plant.
YNN won the bidding for the plant in December 2004, about six months from the formation of the company, which has an authorized capitalization of P10 million.