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NLEx-SLEx connector road project hits another snag

/ 12:02 AM August 30, 2016

A last-minute snag is delaying the awarding of an elevated “connector road” expressway project in Metro Manila that was proposed two administrations ago.

A unit of Manuel V. Pangilinan-led Metro Pacific Investments Corp. (MPIC) was poised to win the project, which would link North Luzon Expressway (NLEx) and South Luzon Expressway (SLEx) via an 8-kilometer tollroad, after no rival offers were made in a Swiss Challenge exercise concluded on July 25.

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More than a month has already passed, but the Department of Public Works and Highways (DPWH) has yet to issue any award notice to Metro Pacific unit Metro Pacific Tollways Development Corp.

Rodrigo Franco, who heads Metro Pacific’s tollways business, said in an interview the current delay was caused by an opinion issued by the Department of Finance under the Aquino administration requiring the project be undertaken by a separate special purposes company (SPC).

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A DPWH official confirmed this while declining to give added details. A DOF spokesman could not be immediately reached for comment.

Franco noted the issue, while not considered a deal-breaker and was currently being clarified between the DPWH and DOF, could nevertheless have implications on their original proposal.

“Our proposal was made on the basis that the connector road would be operated as part of the NLEx instead of a separate company,” Franco said. “If you change again the parameters, you change the entire project that was negotiated on.”

Metro Pacific already operates the NLEx. Using the same entity for the connector road would lead to efficiencies and savings, both in terms of tollroad operations and financing, Franco said.

“When we think about lowering costs, and toll rates, we think it’s unnecessary to have an SPC,” Franco said.

The tollroad project is already years behind schedule, mainly because government agencies could not initially agree on how it should be implemented. Eventually, the original unsolicited proposal route was chosen, leading to the Swiss challenge exercise last month.

However, an award notice is also crucial to get the project moving forward.

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The connector tollroad was first offered by Metro Pacific as an unsolicited proposal during the tail end of the Arroyo administration. The project would now cost about P15.74 billion to build and was expected to be completed by 2021.

Metro Pacific’s connector road proposal, which carries a 37-year concession period, will start at the C3 Road in Caloocan City and end in PUP Sta. Mesa. It will have an opening toll fee of P87.

The DPWH said this will cut travel time from the NLEx to SLEx to about 15 to 20 minutes. Right now, reaching either expressway through Metro Manila’s congested roads could take over two hours.

The DPWH said travel time between Clark in Pampanga and Calamba, Laguna, would be slashed to one hour and 40 minutes from an average of three hours.

A second North to South Metro Manila connector tollroad, backed by San Miguel Corp., is already under construction. It would be finished by 2017 to 2018, assuming right-of-way issues were immediately addressed.

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TAGS: connector road, nlex, North Luzon Expressway, SLEx, South Luzon Expressway
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