24 Jul 2007
Following the series of road shows that it conducted earlier this month to promote the privatization of the National Transmission Corp. (TransCo), the Power Sector Assets and Liabilities Management Corporation (PSALM) officially opened a new round of bidding for the 25-year concession contract to construct, finance, operate and maintain the facilities and assets of TransCo.
The Invitation to Bid for the TransCo concession that PSALM published this week in three major newspapers indicated that the Expression of Interest (EOI) from prospective bidders should be submitted on or before Friday, 24 August 2007.
Interested investor groups availing themselves of the TransCo bidding package, which contains, among other items, the Bidding Procedures, must execute a Confidentiality Agreement and Undertaking and must pay a non-refundable fee of USD5,000. The Bidding Package will be issued starting Wednesday, 01 August 2007, until the prequalification proposal submission deadline on Friday, 21 September 2007.
The Pre-bid Conference for qualified participants in the bidding for the TransCo concession contract will be held on Monday, 05 November 2007, at the PSALM office in Makati City. The bid date is set on Wednesday, 12 December 2007.
To generate investor interest in the TransCo business, PSALM conducted road shows in London, Dubai, Singapore and Hong Kong in the first two weeks of July. PSALM President and Chief Executive Officer Jose C. Ibazeta and Vice President for Asset Management and Electricity Trading Froilan A. Tampinco, along with representatives from the Department of Energy and the Department of Trade Industry, met with investment groups whose inputs are expected to effectively enhance the bidding for the TransCo concession.
Also expected to boost the TransCo bidding is the offer of the World Bank to provide up to USD250 million in Standby Facility Support for the TransCo concession. A similar facility is being offered by the Asian Development Bank as well.
The TransCo concession contract will undergo an open and transparent bid process. To be qualified, prospective bidders for the country's sole transmission system must have the financial and technical capability and experience to operate and maintain electricity transmission systems comparable to that of the Philippines.
The TransCo concessionaire will have to undergo rigorous qualification criteria and will be required to obtain a congressional franchise for public utility operation as a condition precedent to complete the privatization.
Upon award of a franchise, the concession agreement makes the concessionaire responsible for improving, expanding, operating and maintaining the transmission system. The agreement also entitles the concessionaire to receive relevant regulated transmission charges.
Although the legal title to the transmission assets remains with the Philippine government, the concession arrangement ensures that the privatization will achieve the transfer of effective economic ownership to the incoming investor.
Strategic Communications and Partnership Division |