PSALM to get $2.5M for decommissioned plant

MANILA, Philippines- After failing three times to bid out the Manila Thermal Power Plant, the Power Sector Assets and Liabilities Management Corp. has negotiated for the sale of the decommissioned facility for $2.5 million to Malaysian firm Gagasan Steel Inc. In a statement, PSALM, which is tasked to sell the National Power Corp.'s assets, said it has completed negotiations with Gagasan Steel Inc. for the sale of the MTPP. PSALM said the purchase price covers plant equipment, components, auxiliaries, and accessories of the MTPP. It does not include the lot where MTPP sits. Gagasan Steel, an affiliate of Malaysia-based Gagasan Steel Sdn Berhad, is an import-export handler, dealer and trader of scrap metals and has been in operation since 2002. Its local clients include Napocor and the Manila Electric Co. Under the terms for the sale, Gagasan Steel will be responsible for the dismantling of the plant equipment and environmental cleanup. "PSALM decided to conduct negotiations with Gagasan Steel after the third bid exercise held last 06 February 2008 was declared a failure. Gagasan Steel was the only bidder to pass the technical qualifications, but the firm fell short of the reserve price. The first two biddings for the MTPP - held in the first quarter of 2005 and the first quarter of 2007 - likewise failed primarily due to lack of investor interest," the agency said. - GMANews.TV