MANILA -- Diversified conglomerate San Miguel Corp. (SMC) may now seek funding support from the Japan International Cooperation Agency (Jica) for the construction of the P62.7-billion Metro Rail Transit Line 7 (MRT 7), after the government released the remaining key state approvals for the project.
Transportation Secretary Joseph Emilio A. Abaya said the proponent of the multibillion-peso railway-construction venture has already received a copy of two government-issued requirements to financially close the deal.
“They are now in possession of the performance undertaking and the signed implementing guidelines. The ball is now in their court,” he said, explaining that the issuance of the two requirements effectively removes key hurdles from the already delayed implementation of the train project.
A performance undertaking is a state-issued financial guarantee to the concessionaire. With the issuance of the economic security, the Japanese government may now release the official development assistance (ODA) fund to bankroll the initial implementation of the project. Abaya urged the concessionaire to hasten the process, as the project is a much-needed infrastructure that would help ease the bottleneck on Epifanio de los Santos Avenue (Edsa).
“We have requested them to do the financial close as soon as possible,” Abaya said. “I have informed the ambassador of Japan, and he is gleeful with the news.”
The deal is expected to be closed by year-end, while the construction of the 44-kilometer road and rail transportation will begin immediately after this. It is seen to be completed by 2018.
The rail component of the MRT 7 project involves the construction of a 22.8-km rail-transit system that is envisioned to operate 108 rail cars in a three-car train configuration, with a daily passenger capacity ranging from 448,000
It will have 14 stations, starting at the North Avenue Station on Edsa, and will be passing through Commonwealth Avenue, Regalado Avenue and Quirino Highway up to the proposed Intermodal Transport Terminal in San Jose del Monte, Bulacan.
The road component of the project, meanwhile, involves the construction of a six-lane access road from San Jose del Monte to Balagtas, Bulacan, North Luzon Expressway Exit.
The 25-year concession agreement between Universal LRT Corp. (ULC) and the government was signed in 2008, but was delayed due to the proponent’s failure to secure financial closure.
San Miguel Holdings Corp., a unit of the food-to-infrastructure firm, owns a 51-percent controlling stake in ULC.
The engineering-procurement contract for the MRT 7 has been awarded to Marubeni Corp.
Lawmakers earlier called for a review of the agreement, particularly the arrangement on the return of equity, the proposed fare scheme, and the “socioeconomic impact” of the project, especially on families who will be displaced due to its construction.
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