Daily 4-hour blackouts seen

Commonwealth residents should brace for a four-hour power outage every night if the fuel surcharge is not implemented immediately, the Commonwealth Utilities Corp. warned yesterday.

CUC chair Francisco Guerrero said load shedding is the only option left for the utility firm if it fails to generate additional income to pay for the fuel used for power generation.

He noted that Mobil has already threatened to stop delivering fuel if CUC continues to fail to stay within its $10-million credit limit with the oil company.

Mobil made its latest delivery on Thursday, providing CUC enough fuel supply for the next 22 days only, Guerrero said.

He added that aside from this delivery, CUC still owes Mobil for supply provided from November 2004 to January 2005.

If Mobil makes good on its threat, Guerrero said, CUC will have to cut power supply on all three islands at least four hours per night to save on fuel and make its existing supply last longer.

“We have no other choice. We’re trapped,” Guerrero said.

Citing a report by the CUC management, the board chair said CUC’s available cash now totals only $1.4 million. By March, the firm will have less than $200,000 in the bank.

“That’s how much our funds have been depleted by fuel expenses,” he said. “We also need money to pay our independent power producers—Pacific Marine and Industrial Corp. and Telesource CNMI—and our personnel, and for our operations,” he said.

CUC’s monthly fuel cost averages about $5 million, he added.

Currently, the utility firm tries to stay within the credit limit by offering partial payments to Mobil. Guerrero noted, however, that CUC’s debts will accumulate if the corporation keeps paying under this arrangement.

The CUC board of directors approved regulations to implement a 1.5-cent, across-the-board fuel surcharge on Jan. 25, in an effort to raise revenues for fuel costs.

Adopted under emergency procedures, the regulations cannot take effect pending the concurrence of Gov. Juan N. Babauta.

For its part, Mobil has expressed alarm about CUC’s current financial standing and its ability to pay for delivered fuel.

“Mobil is concerned about the developments which have placed CUC in a grave financial position. [Due] to non-payment of government bills to CUC and delays in implementation of a surcharge, CUC has a large deficit and without immediate action to correct the situation. This will affect CUC’s payments to Mobil.

“We remain very concerned and will continue to work with CUC to the extent we are able, but stress the importance of CUC’s continued ability to stay within the established credit extension amounts and make timely payments,” Mobil commercial manager Frances Diaz said in a recent letter to CUC.