Wednesday, December 12, 2007

TRANSCO bid winner favors close Malacanang ally

Debt watchdog Freedom from Debt Coalition (FDC) tagged the recently concluded bidding for the 25-year concession contract to operate the National Transmission Corporation (Transco) a “lutong macao.”

The consortium of Monte Oro Grid Resources Corp. submitted the highest offer of $3.95 billion to operate the country's power grid, outbidding San Miguel Energy which tabled a bid of $3.905 billion.

“We are not surprised that Macapagal-Razon won the bidding because of the alleged closeness to MalacaƱang not only of these people from Monte Oro Grid Resources, but also of the Chinese government through Monte Oro’s partner State Grid Corporation of China,” said FDC outgoing president Ana Maria R. Nemenzo.

Walter Brown of Monte Oro Grid Resources, the so-called Filipino company partner of State Grid Corporation of China, is reportedly affiliated with Diosdado “Buboy” Macapagal, the brother of Gloria Arroyo. Meanwhile, Enrique Razon, a known close ally of Gloria Arroyo, served as treasurer of the administration Team Unity in the May senatorial elections.

“We doubt that a real bidding process took place,” Nemenzo added.

FDC explained that the result is expected to be in favor of Macapagal-Razon of Monte Oro Grid Resources since it turned out that of the four “qualified” bidders only two proceeded with the bid.

The two final bidders were the consortium of State Grid Corporation of China and Monte Oro Grid Resources and the San Miguel Energy Corp. and TPG Aurora B.V.

Two Rivers Pacific Holdings Corporation and its partner Terna-Rete Electtrica Nazionale S.P.A. did not participate in the final bidding while the consortium of Citadel Holdings Inc. and Power Grid Corp of India Ltd. reportedly backed out Tuesday.

“We suspect that Two Rivers did not participate in the bidding because of the serious issues we raised that it has not met the 60 per cent Filipino ownership requirement,” said Nemenzo.

“We also understand that some quarters are raising possible violation by San Miguel Energy Corp. of the cross-ownership provision of the Electric Power Industry Reform Act (EPIRA). Allowing such company to participate in the bidding puts the credibility and integrity of the pre-qualification and the actual bidding in question,” Nemenzo added.

Reportedly, subsidiaries of San Miguel Energy – San Miguel Corp. Bacolod, San Miguel Mills Inc. Batangas, and San Miguel Packaging Specialists Inc., are either generation or distribution companies or customers of Transco.

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