State-run Power Sector Assets and Liabilities Management Corp. is pushing the sale of its real estate assets to lower its debt, its top official said Monday.
PSALM officer-in-charge Lourdes Alzona said the agency would also push through with the privatization of the 650-megawatt Malaya thermal power plant in Pililia, Rizal this year pending the final terms from the Energy Department.
“The remaining asset in our schedule this year is Malaya plant. While awaiting the needed direction, the focus is profiling our real estate assets in addition to liability management to service PSALM outstanding financial obligations,” Alzona said.
She said the agency tasked to privatize government power assets planned to sell the real property assets as “long as legally feasible.”
“We are coordinating with Peza (Philippine Economic Zone Authority) to maximize value of these assets,” she said.
PSALM has real estate assets with an aggregate land area of around 100 million square kilometers, consisting of about 6,160 lots around the country. The agency said the figure might change subject to a “database clean-up.”
PSALM said around 60 percent of total land area is found in Luzon, 39 percent in Mindanao and one percent in Visayas.
The agency has already formulated a strategic plan to liquidate the real estate assets while generating the highest financial return to pay PSALM’s obligations.
PSALM said the sale of the property assets would lead to the reduction of the residual debt of the company, adding tax payments taxes and the money used to secure the holdings could be used for new power plants and other economic activities.
Among the legally-feasible modes identified in the plan are through outright sale, lease and operation and management/maintenance by another person or entity.
The plan proposes to privatize real estate assets in the sites of decommissioned power plants and in lands not related to power generation or under lease agreements, which were previously offered for sale to new plant owners or successor generating companies. They also include lands adjacent to or near privatized power plants or independent power producer plants and those near the remaining power and IPP plants of PSALM.
Former PSALM president and chief executive Emmanuel Ledesma Jr. in 2014 disclosed the plan to sell PSALM’s real estate assets to further reduce the government’s energy sector debt.
PSALM was support to start the privatization program for the real estate assets in 2015 after a board approval.
Republic Act No. 9136, or the Electric Power Industry Reform Act, mandated PSALM to ensure the orderly privatization of government’s power and related disposable assets.