Listed PHINMA Energy Corp. said its board has approved the filing of a case against the Power Sector Assets and Liabilities Management (PSALM) Corp. to stop it from terminating an agreement on naming independent power producer administrators (IPPAs) for the Unified Leyte Geothermal Power Plant.
PHINMA Energy told the Philippine Stock Exchange (PSE) on Monday its board of directors approved the filing of a case against PSALM to restrain the termination of the Administration Agreement for appointing IPPAs for the 40-megawatt strips of energy from the Tonongan-based geothermal power facilities on grounds of administrator’s default.
PSALM, on its website, defines IPPAs as qualified private sector independent entities which will oversee the output from the Energy Conversion Agreements (ECAs) and Power Purchase Agreements (PPAs) that the National Power Corp. entered into with independent power producers (IPPs). IPPAs are appointed through public bidding conducted by PSALM.
PHINMA Energy said that in numerous letters it sent to PSALM, it has formally sought to renegotiate the deal and proposed several measures for relief.
“Representatives of PSALM and PHINMA Energy met on several occasions. PHINMA Energy wrote PSALM expressing the difficulties suffered by the Administrators under the Agreement,” the firm said.
Through a counsel, PHINMA Energy wrote a letter exercising its right to withdraw from the agreement. Talks on the matter were initiated. However, the company received a notice from PSALM of the administrator default. The latter also decided to end the agreement and forfeit the performance bond.
On November 7, 2013, PHINMA Energy (then Trans-Asia Oil and Energy Development Corp.) was given the right to manage the 40-MW strips of energy from the Unified Leyte geothermal plants.
But Super Typhoon Yolanda (international name: Haiyan) struck Region 8 the following day, which caused severe damage to the ULGPP. After the typhoon, PSALM awarded the energy strips to the winning bidders.
Established in 1969, PHINMA Energy is primarily engaged in power generation and supply, with secondary investments in petroleum and geothermal corporation.
Shares of PHINMA Energy slipped 0.55 percent to close at P1.81 on Monday.