LRT1-MRT contract up for bidding in June

MANILA, Philippines—The first of the government’s Public-Private Partnership (PPP) infrastructure projects—the privatization contract for Metro Manila’s two major train lines—will be auctioned off in June, the Department of Transportation and Communications said.

Transportation Secretary Jose de Jesus said bid documents, including the estimated project cost, were being finalized and would be published “soon.”

The department on Monday published an invitation for local companies to submit “expressions of interest” for the operations and maintenance contract for the Light Rail Transit (LRT) line 1 and Metro Rail Transit (MRT) line along Epifanio de los Santos Avenue (Edsa).

“By June, we will bid out the project,” De Jesus said in an interview.

Privatizing the two train lines will not only result in better services to the public but also relieve the burden on the government of subsidizing the operations of the train lines, which cost about P12 billion a year.

He said Metro Pacific Investments Corp. (MPIC), chaired by business executive Manuel V. Pangilinan, has withdrawn its proposal to buy the rights over the train line for $1.1 billion to make way for the bidding.

Pangilinan’s group earlier said it had entered into an agreement to either acquire or control the shares held by MRT’s private investors that would allow the company to take over the train line without going through public bidding.

The DOTC will accept “expressions of interest” from private companies that are keen on bidding for the project until April 15.

In its notice earlier this week, the DOTC said it intended to bid out a four-year operations contract for the LRT line 1 and MRT, extendable by one year.

The DOTC said companies that would express interest in the project would have to pay P10,000. Companies will be given documents that will show the minimum eligibility requirements for the project upon payment of the fee.

Conglomerates San Miguel Corp. and Ayala Corp. have said they were also interested in taking over the MRT and LRT project. The DOTC said no formal offers from both groups had been submitted yet.

The LRT spans from Baclaran in Pasay to Roosevelt in Quezon City and carries over half a million passengers a day. The MRT, which runs along Edsa from Taft in Pasay City to North Avenue in Quezon City, carries 500,000 passengers or higher than its designed capacity of 350,000.