Government-run Power Sector Assets and Liabilities Management (PSALM) Corporation received Php3.12 billion from Fort Pilar Energy subsidiary Belgrove Power Corporation for its purchase of the 650-megawatt Malaya Thermal Power Plant (MTPP) and its underlying land.
PSALM also received Php1.06 billion from the Zamboanga-based firm for the remaining fuel inventory in the MTPP.
“[T]he completion of the sale and the turnover of the Malaya Power Plant to Belgrove mark a major milestone in PSALM’s institutional history as PSALM has been trying to privatize this asset for several years already,” said PSALM President and CEO Irene Garcia.
“The amount of PhP4,185,656,423.99 will be used by PSALM to settle the remaining financial obligations that PSALM absorbed from the National Power Corporation. This is a clear testament to PSALM’s commitment to exert all efforts necessary to privatize and pay for the NPC obligations.”
Fort Pilar Energy surprised the power sector when it outbidded Ayala-led AC Energy in the final round of bidding for the ownership of the plant in Pililla, Rizal back in May.
The purchase price paid by Belgrove is substantially higher than the minimum bid price set by the Board of Directors of PSALM for the MTPP, which was at PhP1,845,222,000.00.
With the completion of the turnover of the MTPP, Belgrove is now authorized to conduct an extensive assessment of the MTPP and pursue all its plans for the plant, which it plans to convert into a “modern energy facility.”
“We at Belgrove are very excited to operate the Malaya Power Plant. We intend to undertake the necessary repairs as soon as possible so that the Malaya Power Plant can resume operations,” said Fort Pilar Energy CEO Atty. Joseph Omar Castillo.
Once the MTPP is repaired, it can supply electricity to the Luzon Grid and help ensure sufficient electricity supply in anticipation of next year’s elections.