San Miguel
Corporation (SMC) still owes the government P23.94 billion even if it insists that it
has no outstanding debts, this according to the Power Sector Assets and
Liabilities Management Corp. (PSALM).
PSALM in a statement refutes SMC the claim of SMC’s
South Premiere Power Corp. (SPPC) that it has no payables due to PSALM
considering it already remitted P314.6 billion.
PSALM’s billings to SPPC, including the unpaid
P23.94 billion, are based on the bid that SMC itself submitted to PSALM in
April 2010 during the public bidding conducted for the Ilijan Independent
Power Producer Administration Agreement (IPPAA).
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The terms of the IPPA agreement were fully
disclosed to all bidders including SPPC long before said public bidding.
While SPPC’s payments to PSALM have now reached
P314.6 billion, PSALM said it is still deficient when payables are computed
based on the bid submitted by SMC and on the IPPAA formula for computing
payables.
PSALM said that as of
December of 2019, SMC is still short of P23.94 billion.
“It is not fair for
SPPC to complain that it has already paid too much to PSALM, or that it needs
to pay even more, because these payments are all based on SPPC’s own bid, a
business judgement of SPPC that it must honor regardless of any change in
circumstances or any impact in its profit margin,” PSALM president and CEO
Irene Besido-Garcia said.
SMC in its defense
said that it had already paid the amount of P314.6 billion, consisting of P73.9
billion in fixed monthly payments and P240.7 billion in generation
charges. The estimated remaining balance for payment to PSALM is at P77.6
billion by the time the agreement expires in 2022. This consists of P23.6
billion in fixed monthly payments and P54 billion in generation charges.
According to SMC, its total paid and unpaid
payments to PSALM will amount to P392.2 billion or P97.5 billion in fixed
monthly payments and P294.7 billion in generation charges.
With the payments made as of January, PSALM had
already gained P40 billion from the deal.
In 2010, San Miguel took on a “bid-to-win”
attitude to clinch the public bidding and become Ilijan’s IPPA. This strategy
of San Miguel resulted in financial consequences that the terms of the 2010
public bidding could bot be changed.
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