Typhoon delays awarding of LRT-1 extension contract

The government will be unable to award the P65-billion Light Rail Transit Line 1 (LRT-1) Cavite extension public-private partnership deal this week, after Typhoon “Glenda” (international codename: Rammasun) caused the cancellation of a key board meeting of the Light Rail Transit Authority (LRTA).

The meeting was supposed to be held Wednesday but was called off due to the typhoon, board secretary Hernando Cabrera said in an interview. Typhoon Glenda barrelled through Luzon Wednesday morning, causing the suspension of schools, government offices, and trading in the financial markets in Metro Manila.

“We are still rescheduling,” Cabrera said, noting that the next window for a meeting could be next week. He said they have not yet confirmed a date.

The approval of the LRTA board was required before an award can be issued to the sole bidder, Light Rail Manila Consortium comprised of Metro Pacific Investments Corp. and Ayala Corp., for the massive PPP deal.

The Department of Transportation and Communications’ bids and awards committee was also required to issue a recommendation of award to the LRTA board.

That DOTC-BAC meeting was also scheduled Wednesday, and because of the same circumstances from Typhoon Glenda, was also cancelled. Jose Perpetuo Lotilla, transportation department undersecretary and chair of its BAC, said in a text message yesterday that they still hoped to come up with a recommendation “this week.”

LRTA is chaired by Transportation Secretary Joseph Abaya and its other members include Cabinet secretaries across the finance, economic and road infrastructure departments.

As noted, only the tandem between Ayala Corp. and Metro Pacific Investments Corp. made a bid for the LRT-1 PPP, which mainly involves the construction of an extension railway line to Bacoor, Cavite and the operations of the aging railway. Six other interested groups did not participate in the auction, now on its second round, as they cited its unattractive financial prospects.

The government, in this case, took several more steps in evaluating the offer of Ayala-Metro Pacific’s Light Rail Manila Consortium, given that there was only one bidder.

Light Rail Manila offered P9.35-billion for the right to expand and operate LRT-1 for a period of 32 years. These steps included securing the approval of the National Economic Development Authority.