Enron drops investment bid in Philippines

By CNN's Amabelle Layug

(CNN) -- U.S.-based Enron Corp has backed out of a $96 million power project in the Philippines after failing to secure a $59-million loan.

Enron was supposed to embark on a join venture with EEI Corp to put up the multi-million dollar Bulacan Biomass project, until the power firm backed out.

The Bulacan Biomass plant, which would use rice hulls to generate power, is one of the government's projects aimed at reducing the country's dependency on imported crude.

However, EEI Corp. chairman Rizalino Navarro said the project has been delayed because Enron negotiated with several creditors last year.

Instead, "Enron said it would rather concentrate on trading," Navarro said.

Enron has been selling power to state-owned National Power Corporation and Manila Electric Co.

Enron was among the companies tapped by state-controlled National Power Corp. to help solve the power crisis that gripped the Philippines in the early 1990s, by putting up power generation plants in the country.

Through its local subsidiaries in the country, Enron has financed and constructed a number of power generation plants in the country including a 116-megawatt plant in the Subic Freeport and Economic Zone and a 110-megawatt facility in Batangas.

The Enron group manages one of the biggest natural gas transmission systems in the world and is the largest purchaser and marketer of natural gas in North America.

The company also markets natural gas liquids worldwide and manages the biggest portfolio of fixed-price natural gas risk management contracts in the world.

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