MWSS ready to talk with SMC unit on Laiban Dam project

MANILA, Philippines - State agency Metropolitan Waterworks & Sewerage System (MWSS) said yesterday it is now in the process of entering into negotiations with San Miguel Bulk Water Co. Inc. (SMBWCI) for the controversial P1.1 billion Laiban Dam project in Tanay, Rizal.

In a press briefing yesterday, MWSS Administrator Diosdado Jose M. Allado reiterated that the regulator has not yet awarded the multi-billion peso project to SMBWCI contrary to critics’ claims, pointing out that the proponent would have a lot of requirements to comply with prior to the awarding of the deal.

“Given the circumstances and increasing water demand, it may not be the best offers but there’s an urgency to do the project. Why should we turn our back on this. We won’t renege on our obligations and responsibilities,” Allado said.

He said no other entity has come forward to submit a letter of intent despite of the sufficient period given by MWSS for competitive challenge on SMBWCI’s unsolicited proposal.

From Feb. 9, 2009 or the time SMWBCI submitted its unsolicited proposal, MWSS has yet to receive word from any other group willing to challenge the offer.

Under the Swiss challenge as provided for in the joint venture (JV) guidelines by the National Economic Development Authority (NEDA), an unsolicited proposal is subject to intense evaluation by a joint venture selection committee, a technical working group and team of legal, technical and financial experts prior to giving challengers a final crack at besting the unsolicited proposal in an open, public and transparent process of competitive bidding.

“There is absolutely nothing secret or sinister, illegal and inappropriate about this project. The Laiban Dam project is a pro-active government initiative that seeks to address the water supply demand of Metro Manila in the year 2015 and to prepare for the inevitable deterioration of the only source of water for Metro Manila – the 41 year-old Angat Dam Reservoir,” Allado said.

Allado cited an opinion handed down by the Department of Justice, saying that the joint venture guidelines are legal and not against public policy or morals and had been passed upon by the Office of the Government Corporate Counsel (OGCC).

He said the JV guidelines do not violate the BOT law or any other law because they are borne out of the same intent to ensure accountability and transparency in joint development projects where a level playing field is laid out for those who have the legal, technical and financial capability.

“These are the same JV guidelines being employed by most government-owned and controlled corporations to encourage private sector participation in what used to be purely governmental activities and no one has complained about it. In fact, a project has just been concluded between the Philippine Tourism Authority and the Manila Water, to develop and operate the existing Boracay Water Supply and Sewerage System using the same JV guidelines,” Allado said.

MWSS deputy administrator Isaias Bongar pointed out that there is already a shortfall in water supply of over 1000 million liters per day and new water sources will be required to contribute an additional 2,868 MLD of capacity by 2025 to match the projected average day demand.

Bongar said there is an urgency to implement the project as the 41-year year old Angat Dam, which straddles an earthquake fault line, is burdened with providing irrigation water for 31,000 hectares of farm land in 20 towns in Bulacan and Pampanga.