MPIC, Malaysian firm to join LRT1 extension project rebidding

By Lawrence Agcaoili, The Philippine Star

Posted at Jan 11 2014 10:36 AM | Updated as of Jan 11 2014 06:36 PM

MANILA, Philippines - Light Rail Manila Consortium led by infrastructure giant Metro Pacific Investments Corp. (MPIC) and Malaysian-owned MTD Philippines Inc. are joining the rebidding of the P65 billion Light Rail Transit (LRT) Cavite extension project in April, the Department of Transportation and Communications (DOTC) reported yesterday.

Michael Arthur Sagcal, DOTC spokesperson, said this brought the number of interested companies for the largest public private partnership (PPP) project under the Aquino administration to six.

Sagcal said SMC Infra Resources Inc. of diversified conglomerate San Miguel Corp., construction giant DMCI Holdings Inc., Filipino-owned Megawide Construction Corp., and Spanish rail transport operator Globalvia Inversiones SAU have earlier purchased bid documents for the project.

“New players have indicated interest in bidding for the LRT1 Cavite PPP project,” he said.

DOTC Undersecretary Jose Perpetuo Lotilla, on the other hand, issued General Bid Bulletin 03 – 2014 setting the schedule for the one-on-one meetings with the interested bidders from Jan. 14 to 16.

The DOTC is giving interested bidders until April 28 to submit their bids for the proposed LRT1 extension project. It has decided to expedite a single-stage process wherein interested groups would submit their qualification documents simultaneously with their technical and financial proposals to shorten the process by at least two months.

Sagcal said the DOTC is expediting the process by adopting a single-stage process unlike the two-stage bidding that includes the technical and financial aspects during the first bidding last August.

“We are expediting it. We will adopt the single-stage bidding process,” he added.

It would be recalled that the DOTC and the Light Rail Transit Authority (LRTA) declared a failed bidding after only one of the four prequalified bidders – Light Rail Manila Consortium led by MPIC - submitted a bid last Aug. 15 while other major proponents backed out due to concerns about the viability of the project.

Three bidders - MTD-Samsung Group, San Miguel Infrastructure Resources Inc., and DMCI Holdings Inc. - withdrew from the process due to concerns including on who would shoulder the real estate taxes.

The National Economic and Development Authority (NEDA) approved the revised terms of several PPP projects including that of the LRT1 Cavite extension project to make it more attractive to interested bidders.

Under the revised terms, the government agreed to absorb the payment of real property taxes (RPT), ensure the integrity of the facility’s structure for a two-year period, permit a five-percent fare increase upon completion of the project, and allow the submission of negative bids.

However, the cost of the project went up to P64.9 billion from P60 billion due to additional components that was originally intended to be pursued as separate projects but was included in the project to make it more robust.

The additional components include some remedial and rehabilitation works for the existing system such as repairing the carriage viaduct, rehabilitating existing trains especially their roofing, as well as making the LRT1 system compliant with laws and regulations.

Other components include the installation of equipment that would be part of the common ticketing system that is also being auctioned by the DOTC.

Other components include contingency costs, on account of the interface risk with related projects such as the automated fare collection system (AFCS) PPP, the construction of the common station linking LRT-1 with Metro Rail Transit (MRT) Lines 3 and 7 in the EDSA-North Ave. area, and the LRT-1 Cavite extension project components procured under the project’s official development assistance (ODA) portion.