One of Britain�s largest energy firms has scrapped its plan of entering the country�s power industry, citing government�s indecision in the privatization of the National Power Corporation (Napocor).

National Grid PLC had earlier expressed its interest in the operating the country�s transmission lines, now under the National Transmission Corporation (Transco), a spin-off company of Napocor which was created under the Electric Power Industry Reform Act.

�We are withdrawing our interest in the Philippine market, particularly Transco, because of our board�s decision to concentrate our efforts in investigating in more mature markets, particularly in the United Kingdom and North America,� Swanson added. The company will instead concentrate on its $10 Billion merger with the Lattice Group, a UK-based gas company for natural gas exploration and development in the Philippines.

Before National Grid formally announced its withdrawal, the power Sector Assets and Liabilities Management Corporation (Psalm), had been counting on the British firm as one of the serious contenders for the lucrative operations and maintenance contract of Transco. Other energy companies who gave signified interest in investigating in Transco are Spanish firms Red Electrica and Endessa, Singapore Power, Tokyo Electric and Kansai Electric of Japan and Hongkong Electric. However, most of these firms are reportedly getting impatient over the delay of the Transco�s sale.

Napoco�s privatization plan requires congressional approval of a franchise for Transco, which will grant the investor control to operate and maintain the country�s power transmission lines. The state-owned firm held a monopoly over power lines. The bill took over a year to be passed by the House of Representative and is now pending at the Senate Committee on Public Services.

Psalm president Edgardo del Fonso remains optimistic however, that National Grid will consider its decision. �We have no official word that they (National Grid) would or would not participate as the formal process for the Transco bidding has not started. We understand that they have concerns about the clarity of the regulatory and legislative framework. �he said.

�National Grid is a highly regarded and experienced transmission operator and we have had useful exchange of insights with them. Our efforts to privatize Transco would greatly benefit from their participation,� Del Fonso added.

Government had been counting on the passage of the Transco franchise bill early this year. It had been expecting to raise an estimated two billion dollars from the sale of Transco. Psalm is hoping to put Transco on the auction block by the first half of 2003.