EDC backs out of Unified Leyte supply management contract

November 21, 2013 3:30 PM

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By: Euan Paulo C. Añonuevo, InterAksyon.com November 21, 2013 12:11 PM

MANILA - Energy Development Corp (EDC) will no longer pursue its bid for government's contracted power generating capacity with the Unified Leyte geothermal power complex after the Leyte-based facility sustained significant damage from Typhoon 'Yolanda'.

In a disclosure to the Philippine Stock Exchange, EDC said wholly-owned subsidiary Unified Leyte Geothermal Energy Inc (ULGEI) is no longer interested in becoming the independent power producer administrator (IPPA) for a portion of government's contracted power supply with the geothermal complex.

"ULGEI has written Psalm that it cannot accept the award of the winning bids as the physical and economic conditions underlying the bidding process and the IPPA administration agreements required to be executed pursuant thereto have been dramatically altered by the severe and widespread destruction caused by Super Typhoon Yolanda," EDC told the PSE.

Psalm refers to the Power Sector Assets and Liabilities Management Corp, which earlier declared ULGEI among the winning bidders for the Unified Leyte's IPPAs, contracts that provide the right to market a portion of the power facility's output that had been contracted by the government.

EDC, which operates the Unified Leyte power complex, recently reported that the facility sustained damage from Yolanda, rendering it inoperable.

Industry sources said that because of the condition of the facility, which is composed of several geothermal plants with a combined capacity of around 600 megawatts, companies vying for the IPPA contracts are likely to rescind their offers.

Proceeds from Psalm's privatization of government's power assets are earmarked for the settlement of National Power Corp's (Napocor) debts.

"I am currently studying the matter," Psalm president Emmanuel R. Ledesma Jr. said when asked how the condition of the Unified Leyte geothermal plants will affect the assignment of IPPAs.

Besides EDC's subsidiary, FDC Utilities Inc of the Filinvest Group, Trans-Asia Oil and Energy Development Corp, Aboitiz Energy Solutions Inc, Waterfront Mactan Casino Hotel Inc, Good Friends Hydro Resources Corp and Vivant Energy Corp made qualifying offers for a portion of Unified Leyte's generated electricity.

Source: interaksyon.com

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