Council summons Asin hydro developer anew

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BAGUIO CITY – The City Council decided to again invite officials of the Kaltimex Energy Philippines, the winning bidder for the rehabilitation of the three city-owned Asin mini-hydro plants, to appear before the local legislative body’s regular session on June 26, 2017 for a briefing on the status of the multi-million project in relation to the confirmed contract between the city and the company.

The local legislators agreed to again invite Kaltimex president Oscar Turalba and other company officials who were involved in the crafting of the memorandum of agreement between the city and the company executed by both parties in 2015 for them to clarify issues concerning the payment of the P18 million performance bond by the developer and other matters.

Earlier, the City Council passed Resolution No. 037, series of 2017 which confirmed the memorandum of agreement entered into between the local government and Kaltimex Energy Philippines for the rehabilitation of the city-owned Asin hydropower plants and urging the company to comply with its contractual obligations, particularly the payment of the P18 million performance bond within six months from the confirmation of the agreement.

Records from the City Treasury Office show that Kaltimex has not yet paid the required performance bond to the said office.

The local legislative body wants Kaltimex officials to explain why it did not pay the performance bond when the 6-month reglamentary period enshrined in the contract is about to expire and to ascertain whether the company is still interested in pursuing the project or it is just finding an easy way out of its contractual obligations with the city.

Earlier, Mayor Mauricio G. Domogan called on Kaltimex officials to comply with their contractual obligations contained in the memorandum of agreement and if the company finds that there are things that must be reviewed, then it must submit a written proposal to the local government which will still be subject to evaluation and assessment and if found meritorious, then that will be the time to renegotiate the contract.

He said that a renegotiation of the contract is still unlikely at this time because the developer has not yet complied with its initial contractual obligations or started its programmed works that is yet to be discussed among the parties and what must be done by the company to start working on the rehabilitation of the deteriorating power plants.

The city-owned Asin mini-hydro power plants located in the jurisdiction of Tuba, Benguet had not been operational since October 2012 when the Energy Regulatory Commission (ERC) ordered the local government to cease and desist from operating the power plants because it did not secure the required certificate of compliance from the regulatory agency even if it  was operational before the passage of Republic Act (RA) 9136 or the Electric Power Industry Reform Act (EPIRA).

By Dexter A. See

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