PSALM bids out new O&M contract for Malaya power plant

By Myrna M. Velasco – April 24, 2018, 10:00 PM
from Manila Bulletin

State-run Power Sector Assets and Liabilities Management Corporation (PSALM) is inviting interested parties anew into the scheduled auction of the Operation and Maintenance (O&M) contract for the 650-megawatt Malaya thermal power plant for the period from 2018 to 2019.

It is apparent in the invitation to bid (ITB) issued by the company that the dangled O&M contract cost had been significantly slashed to P264 million from a higher budget of R457 million for the 2016-2017 period; and almost the same level for the O&M deal that will lapse in August this year.

For the past two years, it had been South Korean firm STX Marine Services Co. Ltd. that had won the O&M contract for the state-owned thermal plant, which is being depended upon by the country’s power system when supply runs tight.

According to PSALM, the bid opening for the new O&M deal will be on May 15 this year, while pre-bid conference is slated on May 2.

The state-run company has specified that “bids received in excess of the approved budget cost shall be automatically rejected at bid opening.”

The contract covers “delivery of goods and services required for one year upon the effectivity of the contract.”

Prospective bidders are required to “have completed within five years from the date of submission and receipt of bids, a contract similar to the project.”

In continually running Malaya plant, it was gathered from industry sources that such must already be studied seriously by the government given the ample supply that Luzon grid has already been experiencing.

In fact, it was further noted that bulk or about 85-percent of the O&M budget being awarded to the contractor account for personnel salaries; and that magnitude of expense cannot even be justified by the level of generation that the Malaya facility has been contributing to the grid.