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Subic Bay Metropolitan Authority (MPD-SBMA)

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20 April 2010

Subic puts power plant on auction block

THE FIVE-year lease for a diesel power plant compound at the Subic free port has been put up for auction, the Subic Bay Metropolitan Authority (SBMA) announced yesterday.

The winning bidder will control not just the 116-megawatt plant but also the 10-hectare property that is suitable for residential or commercial development, the SBMA said in a published notice.

The lease and management of the power plant is being bidded out as intertwined contracts among SBMA, National Power Corp. (Napocor) and the former plant operator and developer Enron Power Corp. expired in March 2009, the free port authority said.

The plant was commissioned in 1994 through a build-operate-transfer (BOT) agreement between Napocor and Enron, the SBMA said.

The facility sat on a property leased by the Napocor from the SBMA and was promptly turned over to the free port authority when both the lease and BOT deal lapsed last year.

“The SBMA wishes to lease out on an ‘as is, where is’ basis the land and facilities within the Subic Bay Power Plant compound...,” the state agency said.

It is the free port’s sole power plant and its output will be channeled to the national grid, SBMA utilities division head Ariel B. Napalan said in a telephone interview.

Both local and foreign firms and joint ventures are welcome to join the auction as long they have more than P200 million in authorized capital stock, the notice stated.

Mr. Napalan declined to elaborate on the minimum bid price and other requirements.

Interested firms will have until May 7 to obtain the terms of reference covering the bidding of the power plant compound at Causeway Extension of the economic zone, the SBMA said.

Proposals are due in early June, Mr. Napalan added.

The 10-hectare lot is being processed for reclassification into a mixed-use area from its currently utilities zoning to accommodate commercial and residential developments, the SBMA said.

The SBMA is overseeing the plant’s operation in the meantime. (Jessica Anne D. Hermosa, BusinessWorld)

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