3rd transport PPP steps towards construction

A P64.9-BILLION project to extend the Light Rail Transit Line 1 (LRT 1) to Cavite has moved closer to the construction stage after the deal was signed yesterday by government and a consortium led by Metro Pacific Investments Corp. (MPIC) and Ayala Corp.

The Light Rail Manila Consortium (LRMC) -- the joint venture company of MPIC, Ayala and Macquarie Infrastructure Holdings (Philippines) Pte. Ltd. that was awarded the deal on Sept. 12 -- yesterday inked the 32-year concession agreement with the Department of Transportation and Communications (DoTC) and Light Rail Transit Authority at EDSA Shangri-La Hotel in Mandaluyong City. LRMC, sole bidder at the June 5 auction, had offered a P9.35-billion premium on top of project cost.

“Twelve months from today, we will be taking over operations and maintenance of LRT 1, and then 48 months after the takeover, LRMC should deliver the expanded LRT 1 system,” Jose Ma. K. Lim, president and chief executive officer of MPIC, told reporters at the sidelines of the event.

Mr. Lim said LRMC will invest P35 billion “over the construction period.”

Ayala President and Chief Operating Officer Fernando Zobel de Ayala said separately that the signing signals the start of the “long and difficult work ahead to extend the 20-year-old rail system.”

Under the deal, LRMC will operate and maintain the existing LRT 1 and extend it for 11.7 kilometers from Baclaran to Bacoor, Cavite. Eight stations will be built along the new route. LRMC tapped French firms Bouygues Travaux Publics and Alstom Transport Pte. Ltd. to build the line, as well as Paris Metro operator RATP Group as “technical partner.”

This is the third public-private partnership (PPP) project DoTC has awarded after the P1.72-billion Automatic Fare Collection System and the P17.52-billion Mactan-Cebu International Airport Passenger Terminal Building. -- CJVDP

source:  Businessworld