By Arjay L. Balinbin, Senior Reporter
METRO PACIFIC Investments Corp. (MPIC) will be interested in taking over the operations and maintenance (O&M) of the Metro Rail Transit Line 3 (MRT-3) and the Light Rail Transit Line 2 (LRT-2) if the government bids out the contracts, according to the conglomerate’s chairman.
“If they bid out the O&M, we’ll be interested,” MPIC Chairman, President and Chief Executive Officer Manuel V. Pangilinan told BusinessWorld last week.
MPIC owns 35.8% of Light Rail Manila Corp. (LRMC), which holds a 32-year concession to operate and maintain the LRT-1. The concession covers the original 18 passenger stations from Baclaran to Monumento plus the north line extension, which covers the two stations in Balintawak and Roosevelt along Epifanio de los Santos Avenue (EDSA). The concession also granted LRMC the right to build an 11.7-kilometer extension from Baclaran to Bacoor, Cavite, with eight stations.
In 2017, a consortium composed of MPIC, Ayala Group and Macquarie Infrastructure Holdings (Philippines) Pte. Ltd. was granted original proponent status for the rehabilitation and O&M proposal for the aging MRT-3.
However, the group decided it would no longer pursue the proposal in 2020. While the Duterte administration said it was still open to privatizing the O&M contract for MRT-3, no progress was made.
The Marcos administration is looking at “partnering with private rail operators for MRT-3’s O&M, with the rail lines assets remaining government-owned,” Transportation Secretary Jaime J. Bautista said in a statement last week.
Metro Rail Transit Corp. (MRTC), which is led by businessman Robert John L. Sobrepeña, is set to transfer the MRT-3 to the government by 2025. MRTC financed the construction of MRT-3 under a 25-year build-lease-transfer deal.
“Today, there is little for them to invest in MRT-3,” Rene S. Santiago, former president of the Transportation Science Society of the Philippines, told BusinessWorld in a phone interview on Saturday when asked to comment on MPIC’s interest in the railway.
“The only thing I think they need to invest in is how to deploy the Chinese commuter trains,” he noted, referring to the trains purchased from China’s CRRC Dalian Co. Ltd. under the Aquino administration. There are issues with the measurements and weight of the trains.
Mr. Santiago said the MRT-3 assets have already been rehabilitated using a $300-million loan. He added it is “logical for the private sector to hesitate to invest a huge amount of money” in the railway “given what happened to LRT-1.”
LRMC has filed an arbitration case against the Transportation department and the Light Rail Transit Authority, the grantors under the 32-year concession agreement for LRT-1. The company wants to recover around P2.67 billion in compensation claims and costs resulting from delays in the implementation of fare adjustments for 2016, 2018, and 2020.
MPIC is one of three key Philippine units of First Pacific, the others being Philex Mining and PLDT. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.
