Cebu consortium trumps Manila-based groups

CEBU, Philippines - A Cebu-based water consortium was able to challenge the Ayala-led Manila Water Consortium based in Quezon City in its bid to develop the P1.55-billion Carmen Bulk Water Supply Project with the Province of Cebu.

The other challenger, the Metro-Maynilad Consortium of Makati City, lost to Cebu Bulk Water Resources Inc. (CBWRI) during the opening of bids attended by Governor Gwendolyn Garcia at the Capitol yesterday.

Manila Water offered P24.90 per cubic meter of water tariff while Maynilad offered P18.71 per cubic meter but CBWRI had the lowest water tariff at P13.95 per cubic meter.

“We look forward to a bright tomorrow with plenty of water for the Cebuanos,” Garcia said after the bidding.

Garcia said the practice of a private-public partnership on major infrastructure projects such as the utilities needed by Metro Cebu is a key component to the sustained phenomenal growth of the island.

CBWRI Vice President Mel Bernel expressed happiness over the result of the bidding, but they have a long way to go as the other bidders were given 30 days to match the bid of CBWRI by the Joint Investment Evaluation and Selection Committee.

The governor shall then decide on the submitted positions of other bidders and issue notice of awards and notice to proceed before the end of January next year.

Years ago the CBWRI, composed of Michel Lhuillier and Mactan Rock Industries Inc., also challenged the offer of Ayala to a multi-million peso water project proposal to Metropolitan Cebu Water District but it was reportedly aborted.

Last April, the consortium composed of the Ayala-led Manila Water and property firm Stateland, Inc. made the bulk water proposal to the governor to supply 35 million liters per day of potable bulk water sourced from the Luyang River to meet the growing water supply requirements of the towns of Liloan, Compostela, Consolacion, Cordova and the cities of Danao, Mandaue and Lapu-Lapu.

The Capitol successfully negotiated last month the unsolicited offer with the consortium subject to competitive challenge in accordance with the Joint Investment Ordinance of the Province approved in 2009.

Aside from qualified bidders, some Manila-based companies also had applied in the pre-qualification bid such as Rio Verde Water Co. and Promark Process International Corp.

One of the qualifications is that the company must have a track record of at least five years in the bulk water business and can supply at least 35 million liters a day. It must also have assets of not less than P800 million following the sharing scheme of 51 percent of the private partner while 49 percent for the Province of Cebu. 

Key features of the proposal include a no “take or pay” provision and the turnover of all the joint investment company’s assets to the province once the 25-year cooperation period has lapsed. (FREEMAN)