Gov’t delays auction deadline for Laguna dike PPP

The government has pushed back the auction deadline for an ambitious public-private partnership (PPP) deal involving a toll road, flood-control dike and land reclamation project along Laguna Lake by two months as certain regulatory and legal issues still need to be resolved.

Prequalified bidders, which include some of the Philippines’ biggest property developers, said the new bid submission deadline for the deal, known as the P123-billion Lakeshore Expressway Dike, has been extended to Jan. 7, 2016, from Nov. 6 this year.

Ariel Angeles, head of PPP Service at the Department of Public Works and Highways (DPWH), also confirmed the new deadline.

The government is in the process of addressing certain issues that some bidders said could affect the viability of the project, Angeles said.

This included a presidential proclamation that would allow the winning bidder, for example, to develop and sell reclaimed land on Laguna Bay. A draft of the proclamation was submitted to the Office of the President last Aug. 26, information on the DPWH’s website showed.

Another legal issue that has yet to be settled was on whether the reclamation would be implemented by the Philippine Reclamation Authority or the Laguna Lake Development Authority, bidders had said.

These risks come to the fore as the project is expected to be awarded months before President Aquino steps down in mid-2016.

The land reclamation component, involving about 700 hectares near Taguig and Muntinlupa, is considered a “sweetener” in the project that also requires the construction of a flood control dike and a 47-kilometer toll road.

As such, this PPP deal has lured major builders and conglomerates like Ayala Land Inc., Henry Sy’s SM Prime Holdings Inc., Aboitiz Equity Ventures Inc. and tycoon Andrew Tan’s Megaworld Corp., which are bidding together via Trident Infrastructure and Development Corp.

The two other prequalified groups are San Miguel Corp. and Alloy Pavi Hanshin LLEDP Consortium, comprised of Malaysia’s MTD Group, South Korea’s Hanshin and the family of former senator Manuel Villar Jr.

“The critical thing is the signed presidential proclamation that they are supposed to issue one month before bidding,” Isaac David, who heads MTD’s Philippine unit, said yesterday.

He noted that the DPWH had signaled that the project could be awarded a month after the bid submission date.

Earlier, the board of the National Economic and Development Authority approved certain changes in the terms, including allowing the original six-lane toll road to be reduced to a four-lane expressway, but this could be expanded later on as traffic volume improves.

The land reclamation part, meanwhile, would comprise a total of seven 100-hectare islands in Laguna Lake about 150-meters away from the shoreline near Taguig, Parañaque and Muntinlupa.

The DPWH added that the flood-control dike was an urgent project and would allow Metro Manila and nearby provinces to deal with natural calamities like strong typhoons.