Power Sector Assets and Liabilities Management Corp. canceled the bidding of the 650-megawatt Malaya thermal power plant in Pililla, Rizal.
“Bidding is deferred until further notice,” PSALM officer-in-charge Lourdes Alzona said.
PSALM was supposed to conduct the bidding for the Malaya power plant on March 30.
PSALM, however, deferred the bidding indefinitely, taking into consideration the proposal of the Energy Department to convert the facility into a liquefied natural gas plant.
Four bidders earlier submitted letters of interest to PSALM for the Malaya facility, including APT Global Inc., Phinma Energy Corp., Riverbend Consolidated Mining Corp. and AC Energy Holdings Inc.
The bidders submitted letters of interest in December last year prior to the announcement of Energy Secretary Alfonso Cusi that he wanted the winning bidder to convert the plant into an LNG facility.
Alzona earlier said PSALM would defer the final decision to the board chaired by the Finance Department and co-chaired by the Energy Department.
“The final transaction document will take into consideration the requirement of DOE for the Malaya’s conversion to a baseload LNG plant. This is currently under discussion and we will defer to the board,” Alzona said earlier.
Cusi said he recommended the conversion of the facility “so that we will not lose power of about 600 MW and we want to have available capacity.”
“We said part of the condition is to convert it [Malaya] to LNG power plant,” Cusi said earlier.
Cusi said the winning bidder should be “willing to convert it to a more superior technology that would qualify as baseload source like LNG.”
“LNG can be easily converted from diesel…We have to study the legalities,” the energy chief said, adding that PSALM agreed to study his proposal.
“If we have to rebid it because of that reason, I think it would be better if we rebid,” Cusi said.
AC Energy Holdings Inc. president John Eric Francia agreed that a rebidding would be a good option because the conversion into LNG facility would represent a material change in the transaction document.
The previous Aquino administration designated the Malaya power plant as a ‘must-run unit’ to address any instability or supply deficiency that may occur as a result of sudden unavailability of any of the operating power plants in the grid.
The Malaya plant consists of a 300-MW unit with a once-through type boiler and a 350-MW unit fitted with a conventional boiler.
PSALM manages the assets and liabilities of National Power Corp. as mandated by the Electric Power Industry Reform Act of 2001.