SAIPAN STRUGGLES TO MEET COST OF FUEL

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By Gemma Q. Casas

SAIPAN, CNMI (Marianas Variety, June 29) – The Commonwealth Utilities Corp. is struggling to raise the money needed to pay for fuel that has to be bought every three days.

CUC spokeswoman Pamela Mathis said they must raise US$200,000 every three days to buy fuel for the privately operated power plant 4 in Lower Base on Saipan.

CUC, she added, is sometimes not able to raise the needed amount as customers usually don’t pay their bills until a day before their power and water supplies are to be disconnected.

"Our cash flow is low. Instead of paying on time, people pay a day before or on the day of their disconnection so there’s no cash flow to pay for the fuel (at power plant 4)," said Mathis.

Last week, power supply on Saipan was rationed every two hours for nearly two days due to an engine trouble at the main power plant and to fuel shortage at power plant 4.

Mathis said CUC’s financial problem is compounded by the islands’ worsening economic crisis.

"Everybody is having a hard time but you cannot run a utility without a regular cash flow," she said.

CUC said its fuel expenses have more than doubled during recent years.

Since this year, it has been buying fuel at over $100 per barrel, up by about 25 percent compared to the previous rate.

"Every customer payment goes toward fuel but the fuel prices have increased so much while CUC has not increased rates — there is now no fund for power plant maintenance," said acting CUC Executive Director Anthony Guerrero.

Although power plant 4 and Tinian’s power plant are operated by private companies, CUC is still obliged to buy their fuel.

Mathis said power plant 4’s fuel supply is not included in the regular fuel shipment that Mobil delivers to CUC from Singapore every 22 days.

June 29, 2006

Marianas Variety: www.mvariety.com

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