Property developers may bid for Manila power plant

Big real estate developers have expressed interest to bid for the decommissioned Manila Thermal Power Plant (MTPP) after the Power Sector Assets and Liabilities Management Corp. (PSALM) decided to include the land in the sale of the power asset.

PSALM vice president for asset management and electricity trading Froilan Tampinco said these property developers are expected to form  joint ventures with scrap dealers or entities that deal with the disposal of decommissioned power facilities.

“There are at least two property developers that signified interest to join or tie up with existing groups of bidders for MTPP,” Tampinco said, although he declined to identify the developers.

Tampinco said PSALM will have no hold on the future plans of the buyers of the MTPP. “They can do whatever they want with the land.  They can develop it.”

But Tampinco pointed out that PSALM wants to ensure  that the winning bidder has the ability or is qualified in disposing any toxic material  normally present in these decommissioned power plants.

“One requirement we want the bidders to have is their capability on toxic material disposal,” he said.

Another requirement, he said, is that the group winning the MTPP auction should be majority owned by Filipinos. Under the law, foreigners are not allowed to own real estate properties in the Philippines.

As of Oct. 12, 2007, he said four groups have already expressed interest to join the MTPP bidding, two of which  are foreign companies.

PSALM will bid out the  MTPP on Dec. 19,  the last generation asset that would be disposed off this year.

The MTPP, located at Isla de Provisor in Paco, Manila , will be offered to interested parties after PSALM received positive feedback from investors on the government’s privatization program.

PSALM earlier planned to back out from offering the retired plant after its auction as  scrap failed. Now, PSALM  hopes to attract more investors in the MTPP auction by including the land in the sale.

PSALM indicated that the MTPP would be sold on an “as is, where is” basis, which would include the plant equipment, auxiliaries and accessories as well as the underlying land.

The two-hectare land is located in a prime area, being near SM Manila and other commercial centers. The size of the land is ideal for industrial purposes.