Awarding of largest PPP deal faces hitches

Prospects for the awarding of a massive railway public-private partnership (PPP) deal linking Metro Manila to Legazpi City in Albay within President Benigno Aquino III’s term has dimmed after the submission of qualification requirements was pushed back to February 2016.

The Department of Transportation and Communications (DOTC) said in a Nov. 24, 2015 bid bulletin that the submission date for the P171-billion South Line of the North South Railway PPP project has been moved from Dec. 1, 2015 to Feb. 1, 2016.

That gives qualified bidders a few more months to prepare bids for the administration’s largest PPP deal before President Aquino steps down in the middle of 2016.

“We don’t expect the project to be awarded during this administration,” John Eric Francia, Ayala Corp. managing director, said in a text message on Thursday.

Transportation department officials did not immediately respond to requests for comment yesterday.

Ayala Corp. is among those seeking to qualify for the project, which will involve a total of 653 kilometers of railway lines. The line is expected to be operational by 2020.

But that schedule may no longer be applicable should the DOTC fail to award the deal within President Aquino’s term.

Based on the DOTC’s initial instruction to bidders before  twice postponing the qualification process, the department said they plan to award the project by April 27, 2016.

The two other interested groups are San Miguel Corp. and Metro Pacific Investments Corp. A fourth group has also acquired bid documents, PPP Center executive director Cosette Canilao said.

The winner of the deal will operate, maintain and upgrade the line over a period of 34 years.

Mass transit services are being eyed as viable businesses given increasing road congestion in urban areas like Metro Manila.

Upon the railway’s full operation, the DOTC said there will be 10 daily trips with seven  train sets passing through 66 stations.

It is expected to yield a demand of 316,000 passengers per day on its opening year, and is projected to entice around 44,000 public and private vehicle users to shift their commutes to the modernized railway.

The private sector partner is expected to design, construct, install, commission, finance, operate, and maintain the existing 56-km. commuter rail line from Tutuban, Manila to Calamba City, Laguna.

It is also expected to do the same for the 478-km long haul rail operations from Tutuban to Legazpi City, with the possible spur lines extension of 58 km from Calamba City to Batangas City and 117 km from Legazpi City to Matnog, Sorsogon.