Energy Development Corp., the biggest geothermal power producer, has received advice its subsidiary Bacman Geothermal Inc. obtained a favorable ruling on an arbitration case against contractor Weir Engineering Services Ltd.
EDC disclosed to the Philippine Stock Exchange the International Court of Arbitration of the International Chamber of Commerce ordered Weir to pay Bacman Geothermal $4.404 million within seven days of the date of the partial award.
The amount relates to the sums owned by Weir to Bacman Geothermal under the its contract, along with the post-award simple interest calculated at the rate of 5.33 percent a year.
The ICC Tribunal also ordered Weir to pay Bacman Geothermal $887,902.03 within 21 days from the date of the partial award.
The ICC Tribunal also ordered Weir from pursuing proceedings in any other forum in connection with disputes arising under from contract with Bacman Geothermal.
“The remaining disputes between the parties will be decided by the ICC Tribunal in the future Phase 2 Award,” EDC said.
Bacman Geothermal, which owns and operates the Bacman Power Plants, filed a request for arbitration of its dispute against Weir with the ICC last year.
The company sought payment of at least US$8.8 million, exclusive of interest, following Weir’s breaches on the contract for works.
These include completion of works on the steam turbine and generator of units 1, 2 and 3 dated March 29, 2012 as agreed between Bacman Geothermal.
Bacman Geothermal engaged Weir to carry out rehabilitation works on the steam turbine, generator and rotor installations in three power-generating units at its Bacon-Manito geothermal power plants, namely Units 1 and 2 at the BacMan I Plant in Palayan, and Unit 3 at the BacMan II Plant in Cawayan.
“BGI initiated the arbitration in order to enforce its rights under the contract, following a favorable determination by the engineer that sums are owed by Weir to BGI. Parsons Brinckerhoff Philippines Inc. is the appointed engineer pursuant to the contract,” EDC said.
The Bacman geothermal plants are composed of three units with a rated capacities of 55 MW, 60 MW and 20 MW.
The plants all use steam supplied by EDC, the country’s biggest geothermal producer.
EDC earlier settled its claims against Siemens Inc. of Germany on the technical problems encountered by the plants.