DOTC clarifies LRT 1 project issues

MANILA, Philippines - This pertains to the column of Jarius Bondoc in your newspaper published on 25 January 2010 entitled “Caught Rushing LRT-1 They’re Giving Alibis”.

On 13 January 2010, we wrote Mr. Bondoc to clarify some points regarding the implementation of the LRT-1 South Extension Project and at the same time requested him that such clarifications be published in the spirit of transparency, but we were not given ample opportunity to be heard.

We wish to emphasize that the project involves the extension of the existing 15 kilometer LRT Line 1 System from Baclaran Terminal to Bacoor, Cavite by approximately 11.7 kilometers, and there were several proposals submitted and received by the Light Rail Transit Authority (LRTA) for the project.

On 20 March 2000, LRTA and SNC Lavalin entered into a Joint Venture Agreement (JVA). However, due to disagreement between the parties on major project issues, the JVA was terminated on 16 September 2005.

In August 2006, IFC submitted a feasibility study to LRTA. It was approved by the NEDA Technical Board. The project did not materialize due to the increase in project cost from US$682.2 million to US$1.780 billion.

In December 2007, LRTA received a proposal from Shanghai Group Foreign Economic and Technological Cooperation (SFECO) to construct the 11.7 km. Extension project at US$1.016 billion. Under SFECO’s proposal, the project will be implemented via an Official Development Assistance (ODA) from the Chinese government. The proposal of SFECO was endorsed to NEDA on 27 November 2009 after the conduct of an evaluation on the cost-effectiveness of each proposal by the Project Review and Evaluation Team that DOTC and LRTA formed per NEDA request. The result of NEDA’s value analysis/engineering study favoring the implementation of the project thru ODA was released on 09 December 2009.

On 15 October 2006, LRTA received a proposal from R-II Holdings, Inc. (EcoRail Transport Services, Inc.). The project cost from Baclaran to Imus is US$1.184 billion.

To set the record straight, the cost of the project as proposed by SFECO is US$1.016 billion and not US$1.78 billion as erroneously stated in the article of Mr. Bondoc. Moreover, if ever the project is awarded, the system will be operated by the Light Rail Transit Authority (LRTA) and not by SFECO.

To date, the project has not been approved, no bidding has been held and therefore, no award can be made whatsoever to any particular entity. The statement that there is an impending award of the contract is without legal and factual basis. If not misleading, as his only source for such statement was an article written by another.

We are attaching hereto a copy of our letter to Mr. Bondoc dated 13 January 2010 for better appreciation of the issues.

We hope we have clarified matters for you and we will appreciate if this clarification will find a space in our well-read newspaper. — GUILING A. MAMONDIONG, Undersecretary for Rail Transport, Department of Transportation and Communications