DOTC awards LRT1 Cavite project to MPIC-Ayala tandem

MANILA, Philippines – The transportation department finally awarded to the tandem of Metro Pacific Investments Corporation (MPIC) and Ayala Corporation the P65-billion contract to build the Light Rail Transit Line 1 (LRT-1) extension from Pasay City to Bacoor in Cavite.

Light Rail Manila Consortium, as the MPIC-Ayala partnership is called, has 20 days to comply with the post-award requirements, Department of Transportation and Communications (DOTC) spokesman Michael Arthur Sagcal said on Friday evening, September 12.

These requirements include paying 10% of its P9.35-billion premium offer. The rest of the amount will be payable during the concession period.

The Cavite Extension project will increase Line 1 from 20.7 kilometers to 32.4 kilometers, which will make it pass through Parañaque and Las Piñas before reaching Barangay Niog in Bacoor, south of Metro Manila.

“The DOTC has just awarded the LRT-1 Cavite extension project to the Light Rail Manila Consortium,” Sagcal said, referring to the largest public private partnership (PPP) project of the Aquino government.

Once the post-award requirements are met, the concession agreement will be signed.

DOTC Secretary Joseph Emilio Abaya made the award after getting a favorable legal opinion from the Office of the Solicitor General. This was after the Supreme Court issued a temporary restraining order on the government’s move to transfer the location of a proposed P1.4-billion common train station to Trinoma mall instead of SM City North EDSA.

SM Prime Holdings Incorporated of mall magnate Henry Sy obtained a TRO on the transfer based on an agreement it signed with the DOTC in 2009, but which the agency unilaterally terminated.

Abaya insisted that the injunction from the Supreme Court only applied to the transfer of the common station and not the P65-billion PPP project.

MPIC Light Rail Corporation leads the winning consortium with 55% of the stakes. Ayala’s AC Infrastructure Holdings Corporation holds 35%, while Macquaire Infrastructure Holdings (Philippines) Pte Ltd. has 10%.

None of the other firms that initially expressed interest in the project – SMC Infra Resources Incorporated, DMCI Holdings Incorporated, Megawide Construction Corporation, Globalvia Inversiones SAU, Eco Rail Services Incorporated, and MTD Philippines Incorporated – submitted bids.

The Light Rail Manila Consortium became the lone bidder on May 28, when it offered a premium payment of P9.35 billion.

More than half of the project cost will cover the construction of the tracks, the stations, and all its attendant facilities. Meanwhile, P30 billion will be used to purchase the trains, to be funded by the government through official development assistance. – Rappler.com