News

EDC wins bid for Bacon-Manito plant for US$29 million

Bacon-Manito geothermal field, Philippines (source: EDC)
Alexander Richter 6 May 2010

A unit of Energy Development Corp. topped the auction Wednesday for the 150-megawatt Bacon-Manito geothermal power plant in Albay and Sorsogon provinces with a bid price of $28.5 million.

Reported from the Philippines, “A unit of Energy Development Corp. topped the auction Wednesday for the 150-megawatt Bacon-Manito geothermal power plant in Albay and Sorsogon provinces with a bid price of $28.5 million.

Bac-Man Geothermal Inc. bested the $17.8-million bid of Therma Power Inc., a unit of the Aboitiz group. Only two bidders joined the auction.

Power Sector Assets and Liabilities Management Corp., the agency in charge of privatizing government’s power assets, said both bids exceeded the reserve price set by the board.

PSALM said it would formally declare Bac-Man Geothermal of the Lopez group the winner of the BacMan plant after reviewing its bidding documents.

The power plant, which started operations in 1993, is not producing electricity, and the winning bidder needs to invest $82 million to repair it, said Luz Caminero, president of PSALM.

Richard Tantoco, First Gen Corp. executive vice president, told reporters the company planned to initially avail of the staple financing offered by PSALM and “we may also pay the lump sum using our internal funds.”

Energy Development, a subsidiary of First Gen, supplies the steam that fuels the BacMan geothermal power plants.

“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 rehabilitation,” Tantoco said.

The facility consists of two steam plant complexes straddling Albay and Sorsogon. The first comprises of two 55-MW turbines both commissioned in 1993. The second, meanwhile, consists of two 20-MW units—Cawayan in Barangay Basud and Botong in Barangay Osiao, Sorsogon City.

Tantoco said the plants had no transition supply contracts with National Power Corp.

“Once we get the plant running, we’ll be going into bilateral [supply agreements] with Luzon customers,” Tantoco said.

The Lopez group is among the most active participants in the government’s power privatization program. It 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.

PSALM’s privatization level has reached the 91.73-percent mark for its generation assets in the Luzon and Visayas grids.”

Source: Manila Standard Today