Big firms to bid for P35-B toll road

Major Philippine and foreign conglomerates are planning to bid for the massive Cavite-Laguna expressway project, a public-private partnership (PPP) deal meant to decongest traffic and spur development south of Metro Manila, after the government restructured and released new terms last week.

San Miguel Corp. ,Metro Pacific Investments Corp. of businessman Manuel Pangilinan and AlloyMtd Group, Malaysia’s second biggest toll-road operator, confirmed plans to submit prequalification documents by Sept. 26. Ayala Corp. was also reportedly interested in participating, an official of the Department of Public Works and Highways said, although this could not be immediately verified.

The DPWH, which will implement the PPP deal estimated to cost P35.42 billion for a 47-kilometer stretch, last week said the project would be fully designed, financed and built by the winning private-sector bidder.

“SMC will join,” San Miguel president Ramon S. Ang said in a text message. The conglomerate in April submitted a winning offer to build and operate the government’s last toll-road deal to be offered, the Naia Expressway Phase II project.

David Nicol, chief financial officer of Metro Pacific, also confirmed that Metro Pacific “intends to submit prequalification documents.” Ramoncito Fernandez, who heads Metro Pacific’s subsidiary Metro Pacific Tollways Corp., separately noted that they were studying details so far released by DPWH.

“We remain interested,” Fernandez said.

Isaac David, president of MTD Philippines, also confirmed that MTD would submit prequalification documents for the Cavite-Laguna Expressway.

The DPWH recently revised the terms of the deal, which was earlier expected to be jointly built by the government and the private sector. It said this format was more advantageous to the government.

Since the PPP was restructured to its current form, the private sector will be responsible for the financing, design, construction and maintenance of the project, which it will operate for a period of 35 years.

Even with the slight delay because of the restructuring, DPWH is expecting the bid submissions by December this year. He added that awarding was expected by Jan. 14.

This will allow the winning bidder to start construction by March 2015 for completion by March 2018, as called for under the original timetable. The gap between the awarding and the start of construction was set aside for the design phase of the massive expressway.

The DPWH said the project would not only increase the competitiveness of the region, known as Calabarzon (Cavite, Laguna, Batangas, Rizal and Quezon), but also decongest the area and shorten travel time to Metro Manila. Calabarzon is home to factories of multinational companies engaged in electronics, automotive and semiconductor manufacturing businesses.

In a presentation last March, the DPWH outlined the importance of the Cavite-Laguna expressway as it noted that the surrounding provinces were the second-biggest contributor to the Philippines’s total economic output at 17.4 percent, just behind the 35-percent contribution of Metro Manila. It added that 70 percent of freight movement was from the Cavite-Laguna region.

The DPWH added that the base toll rate has been set at P5 a kilometer although this could be adjusted every two years.

The toll road starts at the Manila-Cavite Expressway in Kawit, Cavite, and will end at the South Luzon Expressway Mamplasan interchange in Biñan, Laguna.

The Cavite-Laguna Expressway will have nine interchanges upon completion: Kawit, Daang Hari, Governor’s Drive, Aguinaldo Highway, Silang, Sta. Rosa-Tagaytay, Laguna Blvd., Technopark and a Toll Barrier before the South Luzon Expressway.

So far, only three PPP deals, two expressways and a classroom infrastructure project have been successfully awarded by the Aquino administration since the keystone PPP program was launched in 2010.