CAAP ends talks on proposal to bundle 3 regional airports

MANILA, Philippines — The P16-billion proposal to take over three regional airports has exhausted an extended period of review, with negotiators going back and forth on financial costs, passenger forecast and upgrade timeline.

The Civil Aviation Authority of the Philippines (CAAP) ends today, May 18, its negotiations on the P16.05-billion offer by the Philippine Regional Airports Consortium to operate and maintain airports in Davao, Bicol and Siargao.

CAAP deputy director general Danjun Lucas said the regulator has used up the entire negotiation period to develop the most responsive parameters, terms and conditions (PTC) possible.

The PTC outlines the rules of a public-private partnership (PPP), indicating baseline agreements on financial commitment and infrastructure timeline. Further, it lays down what the concessionaire must complete within a specific period.

CAAP’s negotiations with the proponent resumed on Jan. 7, and it was supposed to conclude on March 4. However, CAAP extended the talks for up to 150 days, or until today, to clear up technical matters.

Aside from this, the extension granted the proponent more time to complete requirements, which were still lacking some documents up until last week.

“There are still pending submissions from the proponent for review, [but] as per advice from the PPP Center, we have until May 18,” Lucas told The STAR.

“We exhausted the full negotiation period allowed under the law to ensure a responsive PTC that would be submitted to the approving body,” he added.

It remains to be known, however, if CAAP would demand the proponent to raise the project cost. Lucas said such a change would only be determined once the third-party valuation is turned in.

When asked about CAAP’s preferences, Lucas said the agency would be looking at the proposal with a focus on what the project could bring for passengers. This means closing in on the offer’s financial commitments, modernization program and safety measures.

“Basically, the proposal should be able to demonstrate responsiveness to passenger forecast; the demand of passengers and stakeholders; convenience; modernization; and development of a safe and efficient air navigation and aerodrome,” Lucas said.

The proposal to operate and maintain the Davao, Bicol and Siargao airports will be the first PPP bundle of its kind if approved.

The consortium behind the offer is led by Filinvest Infra-Solutions Ventures Inc. and JG Summit Infrastructure, with backing from the Asian Infrastructure and Management Corp.

The group wants to manage the Davao International Airport and the Bicol International Airport for 30 years. Similarly, it packaged the Siargao Sayak Airport into the proposal, but it narrowed the term to 15 years, citing its different needs.

For Davao, the first leg of the upgrade will expand passenger and cargo terminals and build new airside facilities by 2041. Afterward, the group will turn to infrastructure projects that would hike the gateway’s capacity by 2056.

For Bicol, the proponent will renovate the international area of the passenger terminal building to enable swing operations, to be followed by efforts to scale up capacity.

For Siargao, the goal is simple: Make the airport compliant with the minimum service standards set by the International Air Transport Association to boost reliability.

If the proponent wins the project, it will be the second, third and fourth airport to be handled by the Gokongweis and Gotianuns following the Clark International Airport.