First Gen subsidiary receives ‘notice of award’ on Casecnan hydro plant – PSALM

Fresh River Lakes Corp. (FRLC), a subsidiary of Lopez-led First Gen Corporation, has already been served with the “notice of award” on its winning bid for the 165-megawatt Casecnan hydropower facility in Nueva Ecija.

In a disclosure to the Philippine Stock Exchange (PSE), the company stipulated that asset seller Power Sector Assets and Liabilities Management Corporation (PSALM) had already “issued a notice of award, notifying FRLC that it has been declared the winning bidder for the sale of the 165MW Casecnan hydroelectric power plant located in Pantabangan, Nueva Ecija.”

To recall, the First Gen subsidiary offered a purchase price of $526 million for the asset, which serves as the first major successful power facility divestment under the Marcos administration.

“As the winning bidder, FRLC will be required to comply with PSALM’s requirements to closing,” the Lopez firm stressed.

The state-run asset seller firm previously indicated that it is expecting financial closing for the privatized Casecnan power facility by the end of this year – and the proceeds it would fetch from the sale will be funneled to loans falling due next year.

The prescribed minimum bid price for the Casecnan hydropower asset was pegged at $227.27 million, hence, it is apparent that the government would be able to corner higher revenue from that divestment activity.

The executives of First Gen previously told media that they were able to appraise Casecnan with a higher value compared to rival-firms in the bidding, because that is an asset that they can fully synergize with their existing Pantabangan-Masiway hydro facility as well as their Aya pumped hydro venture which is already being advanced to commercial completion – all three facilities are proximately sited in Nueva Ecija.

“Right now, when you look at Casecnan, fundamentally, it’s a very important asset for us – because obviously we have Pantabangan-Masiway there; and we have plans for project Aya which is also there,” First Gen President and Chief Operating Officer Francis Giles B. Puno noted.

It was emphasized that the ‘operational fit’ of the Pantabangan-Masiway plant to that of the Casecnan hydroelectric power facility is akin to a perfectly solved jigsaw puzzle, therefore, that will bring unique business advantages to the Lopez group.

Upon turnover to the buyer, the Casecnan multi-purpose facility will continue contributing to the power needs of Luzon grid; while also addressing the irrigation needs of farmlands in northern Luzon.