Maynilad sets P26-B wastewater treatment projects

SINGAPORE – Maynilad Water Services Inc. has allotted P26 billion for a five-year plan to improve its wastewater treatment facilities in the Philippines.

Capital for the sewerage and sanitation projects will be drawn from internally generated funds, loans from the World Bank and other banks, company officials said.

The water utility firm of infrastructure conglomerate Metro Pacific Investments Corp. (MPIC) said the P26-billion investment for wastewater projects from 2013 to 2017 will increase the coverage of the sewerage system to 28 percent from the current nine percent in its 520-square kilometer West Zone concession area.

“The main program for water services is to catch up on sewerage and wastewater [treatment],” MPIC president and CEO Jose Ma. K. Lim said.

“Now that we have transformed water services in the West Zone, our challenge is to expand our sewerage coverage. It is going to be very demanding but I believe that our people are up to it,” said Maynilad president and CEO Victorico P. Vargas.

Aside from delivering potable water, Maynilad also provides wastewater services through sewerage and sanitation.

The creation and management of wastewater facilities is essential to Maynilad securing regulators’ nod for higher rates.

This year alone, Maynilad will spend P9.3 billion for the management and development of its wastewater projects, more than triple the P2.7 billion budget last year.

“Maynilad’s wastewater projects will be funded by internally generated funds and a loan granted by the World Bank,” the company said.

On top of the secured funds, the company will raise P5-6 billion this quarter to support the capital spending and refinance existing debts, MPIC chief finance officer David J. Nicol said, adding that Maynilad is mainly in talks with BDO Unibank Inc.

Bulk of the capital expenditures this year will be spent for the construction of new sewage treatment plants in Quezon City, Valenzuela, Pasay and Muntinlupa with a combined volume of 197.5 million liters of wastewater per day. A new septage treatment plant with a treatment capacity of 250 cubic meters per day will also be put up in Manila.

This forms part of Maynilad’s goal to cover the 11.7 million population in its concession area through eight catchment management areas and 56 sewerage treatment plants with a combined capacity of 2.3 billion liters per day by 2037.

The company ended 2012 with 14 sewage treatment facilities, up from just three a year ago. Maynilad owners DMCI Holdings Inc. and MPIC have spent P37.85 billion to enhance and modernize the water and sewerage system in the West Zone.

Maynilad operates and maintains pumping plants, lift stations, sewer lines and wastewater treatment facilities that use both combined and separate sewerage systems.

Given the expertise it developed in its concession area, Maynilad is training its eyes on new franchises.

Maynilad is partnering with the Ayala conglomerate to implement the Carmen bulk water project in Cebu.

It is also set to acquire a majority stake in Subic Water & Sewerage Co. Inc. that has a 40 million liters per day capacity for its distribution and bulk water services.

Lim said DMCI agreed in principle to sell its 40 percent stake in Subic Water for P250 million. To date, Maynilad owns 10 percent of Subic Water, with the Subic Bay Metropolitan Authority considering to sell its 50 percent share.

Maynilad is managed by DMCI-MPIC Water Co. Inc., a joint venture between MPIC and Consunji-led DMCI.  It has a customer base of 1.073 million service connections, with 96 percent enjoying 24-hour uninterrupted water supply.