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THE
Joint Congressional Power Commission (JCPC) is not
abandoning efforts to void the recent sale by the
government of its prime shares in the Philippine
National Oil Co.-Energy Development Corp. (PNOC-EDC) to
the Red Vulcan consortium, and will go to court if
necessary to undo the P58.5-billion deal.
Sen.
Miriam Santiago, JCPC cochairman, said that while the
PNOC-EDC sale has been consummated, the transaction has
yet to be enforced. “In a sense it has been consummated
because the winning bidder has been announced, and was
able to make full payment in cash. The next thing that
should happen is that it should now take over control of
EDC. But not if the JCPC can help it. If we need to go
to court, then we will go court.”
She said
JCPC would first give Finance Secretary Margarito Teves
and PNOC-EDC president Paul Aquino—the two officers
responsible for the sale—an opportunity to explain
themselves.
Santiago
will compile questions raised by commission members at
the hearing and give Teves and Aquino until next week to
answer each. She added the JCPC’s mandate is to monitor
the privatizations in the power industry and to ensure
compliance with the Electric Power Industry Reform Act (Epira).
“The
Epira provides that we must optimize the value of our
power assets that are being sold. If we find that the
value has not been optimized and we, therefore, reach
the conclusion that the law has not been followed, we
would have good legal grounds for ordering them to
withdraw their approval, just as they did in [the
aborted sale of prime shares in] Malampaya,” she said.
In the
case of the Malampaya oil-gas exploration company, the
sale had already taken place, but was canceled owing to
the intervention of former- socioeconomic planning
secretary Romulo Neri.
“It
turned out that the cancellation of the government asset
sale—about Malampaya EC—was correct because eventually
the price of oil rose from $30/barrel to $100/barrel, so
the income from Malampaya rose as well. If we had not
stopped that sale at that time, we would have lost a
valuable asset forever, and it is now making a lot of
money for the government. That is more or less the same
situation as PNOC-EDC.”
JCPC
members are “on the verge of losing” their patience
because the issue simply is how much the PNOC-EDC has
contributed to the National Treasury, said Santiago.
“We
already know how much it was sold for: some P58 billion.
If it [EDC] contributed more than that to the National
Treasury, then why sell it? Because then it would be
able to make more money than it is being sold for in the
very near future. They [the government panel] cannot
give us a ballpark figure. These are huge amounts of
money and we are entitled to an explanation why we are
selling a profitable government enterprise.”
She
recalled that in the time of former-President Corazon
Aquino, the sale of government assets was confined only
to nonperforming assets or government corporations that
were losing money. “We never sold any profit-making
assets because if we sold it to a private owner, he
would profit today and we would have today [only] the
amount that he paid, but the entire revenue stream or
the entire potential earnings of the enterprise would
have absolutely stopped.”
Apart
from what she deplored as “trading instant gratification
for future security,” Santiago added that the most basic
problem in the PNOC-EDC deal is why the officials
involved did not inform JCPC they were selling a
strategic asset.
All the
while, she said, the JCPC was made to believe the
government was still preparing for the sale of certain
assets of the EDC like its geothermal fields and steam
sales agreements.
“We
didn’t have any inkling they were selling 60 percent of
EDC which would make government lose control of a
geothermal firm that is considered one of the first in
the whole world. We are No. 1 in steam sales technology
and No. 2 in steam sales production. Now PNOC-EDC,
through the chair of the Privatization Council [Teves]
and the president of PNOC-EDC [Aquino] himself, want to
sell this valuable asset for what?”
Santiago
is also concerned the winning bidder, the Red Vulcan
consortium, bid for the firm P13.5 billion higher than
the floor price set by the bidding panel. In other
words, she said, the Privatization Council and PNOC-EDC
undervalued a valuable and strategic government asset.
“Even
the buyer himself admitted that the floor price was an
undervalue of the asset. Why make it easy to sell
something that is making money? Their argument there is
very weak, and that now it [EDC] is in its peak price
and we will never be able to sell it in the same amount
again. How did they know that? Do they have any
fact-based data to support their argument? |
