ERAP GIVEN FORUM: Osmena and Co. knew about this legal blank wall even before they started the inquiry into the Impsa deal. Why did they still proceed?

The answer to that poser was clear last Tuesday from the Senate gallery. It became clearer when star witness former President Erap Estrada took the stand and went on to lambaste the Arroyo administration on Impsa and a number of unrelated issues.

If it cannot prove bribery -- and it cannot -- the Osmena troupe is expected to try for the next best thing, which is to plant suspicion in the public mind that former Justice Secretary Hernando Perez and his principal, President Gloria Macapagal Arroyo, shared the bulk of a supposed $14-million bribe.

SABIT SILANG LAHAT: One problem here is that the Senate hearing cannot confine the line of fire to just the Arroyo administration. The CBK project was handled by three administrations -- Ramos, Estrada and Arroyo -- and all three will have to stand in the glare of scrutiny.

A chronology of the events leading to the award of the Impsa contract shows that as early as July 2, 1993, then President Fidel V. Ramos invited the Argentine firm to commission the Kalayaan project within three years. That started a chain that culminated in the CBK project.

The project is identified with Impsa, but the contract of the National Power Corp. is actually with CBK Co. Ltd. composed of Impsa as equipment supplier and Edison Mission Energy of California, which was brought in in 1999, as project managers.

On Nov. 6, 1998, then President Estrada signed as witness to the closing of the contract between Impsa and the Napocor. In September the next year, he also went to visit Impsa in Mendoza, and discussed the project with Argentine President Menem in Buenos Aires.

IMPSA IMPLEMENTS CONTRACT: With its contract, Impsa commenced work at the site on Feb. 7, 2000. Three days later, Estrada gave full-powers authority for Napocor officials to sign and deliver the CBK contract. Rehabilitation of Unit 2 (181 megawatts) was completed on Oct. 12, 2000, with Estrada still in Malacanang.

Impsa said that the contract was approved by Estrada. That it started work on the project in February 2000 on the basis of its signed contract lends credence to this. That the Estrada administration did not stop Impsa bolsters the firm’s claim that the deal was already approved.

Estrada has claimed that his side was offered $14 million for the approval of the contract. With documents showing that the contract had been approved and with the project having started during his watch, a logical question is:

What happened to the $14 million promised Estrada? He said he rejected it. But he admitted not doing anything to arrest or prosecute the person who offered the bribe.

CONFUSING CLAIMS: The flurry of conflicting claims about various aspects of the project has raised questions.

For instance, why did Impsa still need another legal opinion from Justice Secretary Hernando Perez after the Arroyo administration took over and caught up with the ongoing project?

Note (1) that Impsa has claimed that the contract was already approved by the Estrada administration, (2) that it has started work on the project, and (3) that Estrada’s Justice Secretary Artemio Tuquero already had issued a favorable and adequate legal opinion.

Estrada explained that Impsa needed a sovereign guarantee for its loans, an assurance that he said was not given by his administration as a matter of policy. He added that the guarantee that he had denied Impsa was given it by the Arroyo administration through a legal opinion of Secretary Perez.

GOV’T GUARANTEE: Comes now a CBK (Impsa) spokesman telling us: “What we consistently asked for and got from the Estrada government was a ‘government undertaking’ (GU), which assures us that the government will see to it that the National Power Corp. (Napocor) pays us for services delivered. The GU is in no way a guarantee on loans.”

He belied reports that Impsa’s loans were guaranteed by Napacor and not by the Philippine government. He said that Napocor was not in a financial position to make guarantees. Besides, it is a signatory to the contract and it would be illogical for it to guarantee the loans of the other contracting party (Impsa).

But if it already had the contract in its pocket together with a favorable legal opinion from Estrada’s justice secretary and had no need for sovereign guarantee of its loans, why did Impsa have to seek the Arroyo administration’s blessings by way of a favorable legal opinion?

PEREZ OPINION NEEDED: To sort out the confusion, we fall back on what we know of politicians and corruption. In fairness, however, we have to warn the reader at this point that what we are about to say is pure opinion.

1. We think it is likely that some well-placed people from the three successive administrations of Ramos, Estrada and Arroyo benefited from the CBK project. With the project costing $450 million, we do not find it far-fetched that some of the dollars had spilled over to some waiting palms.

But, as we said at the start of this column, it’s another thing proving bribery or extortion. The art has been so perfected that the artists leave the scene without any trace.

2. The project was approved, in fact and in principle, by the Estrada administration. Had President Estrada continued in office, the Impsa project would have gone on normally like the other emergency power projects hatched by the Ramos administration.

3. There was still need for a legal opinion from Secretary Perez, because that is the way things work in this country. When a project already approved by an outgoing administration is caught in midstream by the successor administration, ooops… the project proponents will have to “make lakad” all over again with the new dispensation. At panibagong gastusan na naman!

SINONG EDDIE?: If the contractors do not talk to the new bosses, they will be asked “Paano naman si Eddie?”

“Sinong Eddie?” the uninitiated will ask.

“E di ako!” the new official in charge will retort, palm outstretched.

(POSTSCRIPT comes out in the Philippine STAR every Tuesday, Thursday and Sunday. Its online edition is uploaded the night before at http://www.manilamail.com)

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