BRUNEI ROYALTY EYES TRANSCO

MANILA, November 30, 2004 (STAR) By Donnabelle L. Gatdula - A close relative of Sultan Haji Hassanal Bolkiah of Brunei Darussalam has reportedly signified interest in participating in the public bidding for the 50-year concession contract of the National Transmission Corp. (Transco), a ranking energy official said.

The official, who requested anonymity, said "a cousin of the Brunei Sultan would be joined by a local group composed of former National Power Corp. (Napocor) employees in forming a consortium to bid for the Transco concession".

According to the official, this group is one of the three new parties that have indicated plans for the Transco bidding.

Four consortia have earlier submitted their indicated bids to the Power Sector Assets and Liabilities Management Corp. (PSALM) before the government decided to change the mode of Transcoís privatization from a negotiated bid to a public bidding.

Sources said one of these groups is the consortium led by the Electricity Generating Authority of Thailand (EGAT) which will be reportedly joined by Citra of the Salim Group to handle the technical aspect while Northeast Development and Acquisition Corp. will be in charge of the financial side. NDAC officials Daniel Aurelio and Jose Salazar reportedly coordinated with PSALM on the bidding.

Another group that has signified interest for Transco is composed of Japanís Tokyo Electric Corp. and US-based Trans-Electric (for technical), and San Miguel Corp. and Morgan Stanley (for financial).

The other group, sources said, is composed of First Pacific Co. Ltd. (financial) and Trans-Grid of Australia (technical).

The remaining group is reportedly composed of Hydro Quebec for the technical aspect and SNC Lavalin which will be in charge of the financial requirement of the consortium.

Singapore Power Corp., which was the lone bidder in the two previous biddings conducted by PSALM for Transco, has reportedly decided to take to the sidelines this time.

Sources said the Singaporean government was not too keen on the idea of taking the lead in the bidding process. "What the Singaporean power firm intends to do is to enter into a joint venture with the winning concessionaire," an industry source said.

PSALM said it is optimistic it could bid out the concession contract of Transco within the year.

Though PSALM has successfully secured an opinion from the Department of Justice (DOJ) clearing some legal issues on the privatization scheme, members of the Joint Congressional Power Commission (JCPC) is still questioning PSALMís authority to change the pertinent provisions of the Electric Power Industry Reform Act (Epira).

JCPC co-chairman and chairman of the House Committee on Energy Rep. Alipio Badelles said PSALM has no authority to amend or revise the existing privatization plan of Transco without securing the endorsement of the JCPC.

Badelles said the DOJ opinion is equivalent to a license for PSALM to violate the Epira, which tasked PSALM to submit a privatization plan for the endorsement of the JCPC and approval of the President.

"Be it remembered that PSALM is privatizing Transco pursuant to the privatization plan previously endorsed by JCPC and approved by the President," the lawmaker said.

Badelles also said the conditions and terms stipulated in the privatization plan cannot just be revised or amended by PSALM without securing the endorsement of JCPC. "To allow PSALM such power is tantamount to imposing its own judgment as against that of the JCPC," he said.


Reported by: Sol Jose Vanzi

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