AFTER announcing that it plans to prepay debts of the state-run power company, the Power Sector Assets and Liabilities Management Corp. (Psalm) said Tuesday that it is ready to chop off a huge part of the government’s debt by prepaying up to $1 billion of the National Power Corp.’s (Napocor) loan obligations.

In a statement, Psalm said the $1-billion debt in plans to prepay is equivalent to 14 percent of Napocor’s debts.

“We have identified some loan agreements which allow for prepayment, and we now have the resources for prepayment because of the excellent proceeds generated by the privatization of Napocor’s power plants,” said Ferdinand George Florendo, Psalm manager for Capital Markets and Risk Management.

The Electric Power Industry Reform Act (Epira) provides that proceeds from the privatization of the government’s electricity assets, including the concession for the operation of the National Transmission Corp. (Transco), which is set for bidding on December 12, will go to the liquidation of Napocor’s debts.

“We have evaluated Napocor’s loans and we determined that prepaying this portion of Napocor’s debt, consisting of yen-denominated loans, at this time will produce optimum benefits for the Filipino people,” Florendo said.

Psalm Capital Markets Department and Napocor’s Finance Group are also considering other finance structures such as swaps and options available in the international financial markets to maximize the use of proceeds from the power privatization program.

“This, however, does not necessarily mean that Psalm and Napocor will no longer need to borrow money, as the proceeds from privatization may not be enough to cover all of Napocor’s $7.2-billion debt, and because the timing of when we receive payments will have to be matched with the scheduled debt-service payments,” Florendo said.

He added that Psalm is eager to complete Napocor’s privatization successfully and liquidate its debts as soon as possible because any unpaid portion of its debts becomes part of the consumers’ electric bill through the universal charge, in accordance with the Epira.

“Ultimately, the continued success of the privatization of Napocor’s power plants and the Transco concession will result in cheaper electricity for the Filipino consumers,” Florendo said.

PRIVATE mining companies in the Philippines have urged French and British investors to explore the mining industry in the country as they presented information on the business opportunities at the recent high-level delegation in Paris, saying the Philippine economy has grown stable since the Asian crisis in 1997.

AFTER announcing that it plans to prepay debts of the state-run power company, the Power Sector Assets and Liabilities Management Corp. (Psalm) said Tuesday that it is ready to chop off a huge part of the government’s debt by prepaying up to $1 billion of the National Power Corp.’s (Napocor) loan obligations.

AN antidebt watchdog urged members of Joint Congressional Power Committee (JCPC) on Tuesday to stop the Power Sector Assets and Liabilities Management Corp. (Psalm) from bidding the 25-year concession contract to operate the National Transmission Corp. (Transco), saying that the government could lose a minimum of around P246 billion in potential earnings.

THE use of the mandated 1-percent coco-biodiesel blend (B1) has significantly cut down carbon emissions in Metro Manila, according to data from the Department of Environment and Natural Resources (DENR).

LAWMAKERS asserted Tuesday that the secretary of finance cannot assign to a subordinate his review powers under the Tax Code, especially if this authority was exclusively delegated to him by Congress.

THE transportation department signed a consultancy contract last week with the Aviation Systems Consultants Co. Ltd. (Asco) for the improvement of the country’s aviation industry.

A FISHERY nongovernment organization is asking the government to stop the ongoing oil and gas exploratory drilling in Tañon Strait off Cebu if the company conducting the exploration and the Department of Energy (DOE) would not offer compensations to 1,500 fishermen affected by the fishing ban.