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THE
chief of the Power Sector Assets and Liabilities
Management Corp. (Psalm) who has overseen the selling of
state electricity assets quit Wednesday, on the heels of
the failed auction of a transmission grid contract.
The
resignation of Nieves Osorio, 56, has been accepted by
Malacañang, Executive Secretary Eduardo Ermita
announced.
Osorio,
who was appointed to the post in July 2005, will be
replaced by Jose Ibazeta, a special envoy to the
Middle East, the Palace said.
She
denied she was forced to resign. In a statement, Osorio
said: “After almost two years at the helm of Psalm, I
have decided to resign from my post after having
accomplished major targets set by the corporation. The
period saw some high and low points that I would not
have handled without the unflagging support of very
professional and dedicated members of the management and
staff of Psalm.”
She
thanked the Psalm management and staff for
uncomplainingly spending long hours without additional
compensation to just get the tasks done.
She
conceded the disappointments under her watch, but noted
several accomplishments in privatizing state power
assets, despite the odds. The latest setback was the
failed bidding for the 25-year Transco concession, after
only one of three prequalified groups submitted a bid.
Transco runs the nationwide power transmission grid.
The
government decision to rebid Transco was initially
protested by the Terna-Citadel group, which submitted
the bid. The Italian-backed firm invoked legal
provisions allowing the state to negotiate after two
failed biddings, but the government decided to rebid in
order to avert any unsavory talk that it said could
spoil Terna-Citadel’s award.
In her
exit statement, Osorio alluded only to two other cases:
“We have had our share of disappointments—such as the
failed biddings for the 600-megawatt Masinloc and
600-megawatt Calaca coal-fired power plants,
controversies on which our detractors feasted. But these
did not distract nor deter us from moving on to achieve
what the law, the Electric Power Industry Reform Act (Epira)
of 2001, had mandated us to implement,” said Osorio.
Ibazeta,
63, is director and treasurer of International Container
Terminal Services Inc., the nation’s largest private
port operator.
In
announcing Ibazeta as choice for Psalm, President Arroyo
said, “We need a business-minded professional manager in
Psalm.” Neither she nor Ermita said when Ibazeta will
assume the post.
Amid
tough challenges, according to Osorio, Psalm also had
its share of successes. She recalled that Psalm was able
to collect the $14-million performance bond from YNN
Pacific Consortium after it failed to deliver the
up-front payment for Masinloc. Psalm also successfully
bid out major power facilities such as the 112-megawatt
Pantabangan-Masiway hydroelectric complex and the
360-megawatt Magat hydroelectric plant.
“The
Philippine government was commensurately compensated.
When the bids were opened, these plants fetched an
aggregate price of $659 million, prices that were way
beyond its own expectations. Psalm is proud to say that
for these major transactions, there were no complaints
as we have always exerted our utmost effort to keep our
process fair, transparent and credible,” Osorio said.
Last
year, she said, Psalm created a cash flow of $673
million, which, as provided by Epira, will be used to
pay the debts of the National Power Corp.
Osorio
noted that Psalm had brought the level of privatization
from less than 1 percent in 2005 to 11 percent by the
end of 2006. The government is far from the Epira target
of 70-percent privatization, but Psalm has started to
gain the momentum, she added.
Such
progress was possible with the support of other
government agencies, among them the National Irrigation
Administration, the Office of the Government Corporate
Counsel, and the Department of Environment and Natural
Resources, she noted.
She
acknowledged support from the government’s multilateral
partners, particularly the Asian Development Bank, for
granting last year its universal consent that would pave
the way for the transfer of debts and assets of Napocor
to Psalm as mandated by the Epira.
The
World Bank has told Psalm it is now ready to grant the
same omnibus consent. “These consents are required
before the government can complete the sale of any power
facility which these multilateral lenders had funded in
the past,” Osorio said.
Psalm
had laid down the groundwork for currency swaps which
could provide hedges from foreign-exchange fluctuations
to Napocor, whose debts are mostly denominated in US
dollars and other foreign currencies.
“We
successfully raised funds for the requirements of
Napocor, Psalm and the Transco, even as we continue to
work on improving the financial conditions of these
power agencies through implementation of the universal
charges and liabilities management strategies,” she
said.
“I would
like to . . . dispel speculations that I have been
forced to tender my resignation because of the outcome
of the bidding for the 25-year concession of Transco,”
Osorio stressed.
She said
she made a personal commitment last year to finish this
specific transaction (bidding of Transco).
“We have
done our best and despite some limitations among them
the absence of a congressional franchise for the future
concessionaire, we have actually reached the bidding
stage, crafted a transaction document on which we had a
group of investors who were willing to take the risk
with us,” Osorio said.
Energy
Secretary Raphael P.M. Lotilla commended Osorio for her
accomplishments at Psalm, including obtaining the
consent of ADB and World Bank to the transfer and sale
of Napocor assets and liabilities; the sale of
Pantabangan and Magat; in moving the management of
Napocor liabilities significantly forward; and in
successfully obtaining financing for Napocor at
favorable terms for the government. (With Bloomberg) |
