Press Release
July 11, 2006


Senate Minority Leader Aquilino Nene Q. Pimentel, Jr. (PDP-Laban) today said the government should now start the process of rebidding the 600-megawatt Masinloc power plant instead of giving the buyer, YNN Pacific Consortium another 30 days to settle the $227 million downpayment after failing to pay up when the third payment deadline expired on June 30.

Pimentel said YNN Pacific lost its right to acquire the power plant when the Power Sector Assets and Liabilities Management (PSALM) Corp. confiscated the companys $14 million performance bond.

The duty now of PSALM is to ensure that another bidding process is done where the bidders are qualified pursuant to law and not according to the clout of their political backers, he said.

The minority leader said PSALMs sudden decision to give YNN Pacific a 30-day grace period undermines government interest and violates the PSALMs condition that the June 30 deadline should no longer be extended.

Pimentel said a rebidding of the power plant is in order as he doubted the validity of the reported takeover by Ranhill Berhad, a Malaysian firm, of YNN Pacific, principally owned by businessman Sunny Sun, for $8 million.

He said Ranhill Berhad could not buy out YNN Pacific just like that because YNNs asset purchase agreement with PSALM prohibits the buyer from transferring its rights to another investor.

The asset purchase agreement provides that YNN shall not, at any time, from award date until the full payment date liquidate, wind up, dissolve or otherwise, transfer or dispose of all or substantially all of its property, assets and business.

Pimentel said Ranhill Berhad, before it can be allowed to take over YNN Pacific and acquire the right to own and operate the Masinloc plant, should comply with all the requirements of law pertaining to the privatization of the governments power assets.

He said Ranhil Berhad should not be exempted from bidding rules just because of the reported intercession of former President Fidel Ramos, chairman emeritus of the ruling Lakas NUCD which has links with the United Malaya Organization whose leaders supposedly have interest in the Ranhill.

PSALM should make sure that Ranhill Berhad makes it on its own merit and not because the name of former President Ramos is recklessly dropped as supportive of its desire to buy the Masinloc plant. If Ranhill Berhad qualifies according to law, then, by all means, barring better offers, it should get the contract.

Meanwhile, Pimentel said he agrees with Finance Secretary Margarito Teves, PSALM Board Chairman, that the proceeds of the forfeited $14 million performance bond of YNN Pacific should go to the national treasury to augment the funds for infrastructure projects and social services.

Good for Teves that he now sings a different tune. Good for him. Otherwise, he will be singing the administration all the way to jail for violating the Anti-Graft Law, he said noting that it was the PSALM board that extended the payment deadline by 30 days more which he branded as illegal.

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