Negotiated procurement eyed to implement asin minihydro privatization

Aileen Refuerzo
Posted: 31-Mar-2014 / 3 years 20 weeks ago


            BAGUIO CITY – The city government should resort to negotiated procurement method to implement the long delayed privatization, development and operation of the Asin mini-hydroelectric plants in Nangalisan, Tuba, Benguet after four failed bidding exercises.

 This was the recommendation of the Special Bids and Awards Committee (SBAC) after declaring the failure of the fourth bidding conduct in October last year in view of the disqualification of Kaltimex Energy Philippines Inc., the lone company which initially passed the bidding requirements due to deficiencies in legal and financial requisites.

            Mayor Mauricio Domogan on Wednesday confirmed the development and expressed hope that the city can eventually find a worthy company to undertake the project.

            The SBAC in Resolution No. 1 last March 17 said Kaltimex’s disqualification was  based on the findings of the SBAC Technical Working Group that the “legal and financial aspect of (Kaltimex)’s bid failed to comply with the requirements stated in the Eligibility Requirement and Terms of Reference…”

            In Resolution No. 2, the SBAC recommended negotiated procurement as “alternative mode to finally secure the best possible contract for (the project).”

            Negotiated procurement is one of the alternative methods of procurement provided under Republic Act 9184 or An Act Providing for the Modernization, Standardization and Regulation of the Procurement Activities of the Government…

            Based on section 53 of the Act, it can be resorted under “extraordinary circumstances” such as “in cases of two failed biddings...”

The October 2013 bidding was the fourth of such exercise conducted by the city for the said project.  The first three biddings conducted in January and June in 2012 and in June 2013 failed due to the disqualification of the companies that tendered offers.

            The project entitled “Privatization of the Operation and Management of Asin Mini-Hydro Power Plants” has an approved contract budget of P500,000,000.

            Based on the terms of reference, the bid components will be for the rehabilitation and rental under the conditions that the operator shall invest a considerable amount of money for the rehabilitation, upgrading and expansion of the plants to produce 41,406,178 kilowatthours, install independent substation and power line to the national grid.

            Under the approved terms of reference for the project, the city expects an annual income of P18 million or 30 percent of the gross earnings, whichever is higher.

            The terms also provided the schedule of remuneration to the city government and other concerned parties including the provincial government of Benguet, municipality of Tuba and barangays Tadiangan and Nangalisan where the plants are located and including the surface owners whose properties are affected by the pipelines and plant facilities.- A Refuerzo

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