BGI files counter-charges against European firm

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Bacman Geothermal Inc. (BGI), a wholly owned subsidiary of Energy Development Corporation (EDC) of the Lopez family, on Tuesday filed counter-charges against its European contractor before an international arbitration court.

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BGI, which operates the Bacon-Manito (Bacman) geothermal plants in the Bicol region, said it filed a request for arbitration against Weir Engineering Services Ltd at the International Court of Arbitration of the International Chamber of Commerce.

BGI said in a disclosure to the Philippine Stock Exchange that Weir breached the contract for works of steam turbine and generator of Bacman Units 1, 2 and 3. BGI sought payment of $8.81 million in damages.

Weir had earlier filed arbitration proceedings against EDC due to “unpaid balance of contract price.” But Weir did not indicate the actual “unpaid balance.”

BGI said it engaged Weir to carry out rehabilitation works on steam turbine, generator and rotor installations in three existing power-generating units at the BacMan I Plant in Palayan, and Unit 3 at the BacMan II Plant in Cawayan.

“BGI initiated the arbitration in order to enforce its rights under the contract, following a favorable determination by the Engineer that sums are owed by Weir to BGI,” EDC said.

Arbitration is an alternative scheme of settling disputes between or among parties that could be done outside the confines of the courts.

Parsons Brinckerhoff Philippines, Inc. is the appointed Engineer pursuant to the Contract.

EDC said its demanded for damages was intended to cover “legal interest and attorney’s fees, liquidated damages and sums due to BGI in relation to defects and damage caused by workmanship.”

Since its acquisition in 2010, the BacMan geothermal facility had gone through rehabilitation works.

This latest request for arbitration was the second to be lodged in connection with the BacMan facility’s rehabilitation works.

The first arbitration was filed by EDC against its first contractors: TurboCare, Inc. (now known as Ethos Energy TC Inc.) and German firm Siemens Inc. due to ‘unmet commitments.”

The complaint, however, was later dropped after parties reached ‘mutually satisfactory outcome’ as to the settlement of their dispute.

BacMan consists of BacMan I with two 55-megawatt turbines and BacMan II with 20-MW geothermal facilities.

The geothermal power plants are located in the towns of Bacon in Sorsogon province and Manito in Albay.

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