Naga OMSC contract reduced

After several quarters questioned the widely perceived exorbitant Operation and Maintenance Service Contract (OMSC) cost for the Naga thermal power facility, this was suddenly reduced by the Power Sector Assets and Liabilities Management Corporation (PSALM) to R319.389 million from R348.91 million originally.

The puzzle lurks deeper though as to how the company has been drawing its numbers when it comes to setting the costs on the assets or service contracts it had been offering via competitive bidding.

PSALM has placed the Naga OMSC for another round of auction, a process that will allow it to engage a private sector party to operate the facility for one year. Bid submission and opening date is November 20 this year.

In a separate development, the company has started soliciting offers from domestic coal suppliers for the fuel blending requirement of the Naga thermal power facility.

It specified in the tender notice that the Naga plant will be in need of 25,000 metric tons of locally-sourced coal supply.

The approved budget cost for the coal delivery was placed at R119.529 million, charged against PSALM’s corporate operating budget. Bid submission is slated November 13 this year.

The local coal component of Naga’s fuel supply can be used for blending to the higher grade imported coal.

On the OMSC for the facility, PSALM has maintained that the contractor shall be confined to majority-owned Filipino corporations, in keeping with the provisions of the Government Procurement Law.

The state-run firm further emphasized that “bidders should have completed within five years before the date of submission and receipt of bids a contract similar to the project.”

https://www.mb.com.ph/articles/378903/naga-omsc-contract-cost-reduced