Officials to decide on Bulacan airport project by December

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Metro Manila (CNN Philippines, September 10) — It may take some time before the proposed Bulacan international airport is built.

Officials said no construction will happen this year although they've committed to make a decision by December.

Public Services Committee Chair Senator Grace Poe, in a Senate hearing on Monday, asked airport authorities for details on the Bulacan International Airport project. It can accommodate some 100 million passengers a year, and expected to ease congestion problems at the Ninoy Aquino International Airport, which has a capacity of about 65 million passengers annually, transport officials said. 

They said at the hearing unsolicited proponent San Miguel Corporation (SMC) will have to undergo a Swiss challenge with another potential proponent, which can match their pitch.

The Swiss challenge system allows a private group to send a proposal to the government, then third parties can either match or surpass the proposal.

Also to be included in the Department of Transportation's (DOTr) decision is the expansion of the Ninoy Aquino International Airport.

Transportation Undersecretary Ruben Reinoso said, "The law requires that proponents or comparative proponents submit their proposals not later than 60 days. If after 60 days we receive a proposal and challenge proposals, which is better than what is being offered by the original proponent, then we revert to the original proponent and ask them to match the superior proposal."

If it is matched, Reinoso said, the contract will be awarded to the original proponent. If not, the contract will be given to the challenger.

"If after 60 days walang lumaban [there are no challenges], then we sit down with San Miguel and we execute the notice of award," he added.

Finance Secretary Sonny Dominguez said there was a need to re-evaluate the construction plan and the capacity of San Miguel.

The company has until Friday to submit a draft concession agreement for the re-evaluation.

Dominguez added, "We wanted to know if the proponent San Miguel Holdings Corp. actually has the financial capacity to undertake the project. Initially the DOTr reported than San Miguel have a total equity of P60 billion in 2016. Considering... the construction of the Bulacan airport will require SMC to infuse around P200 billion in equity which we are not sure is going to happen."

Reinoso, however, was confident in San Miguel's ability.

"Knowing San Miguel, nakita niyo naman siguro yung MRT 7 nila. As soon as they were able to secure the final approval while waiting for the financial closing nagsimula na sila," he said.

[Translation: Knowing San Miguel, I'm sure you've seen their MRT 7. As soon as they were able to secure the final approval while waiting for the financial closing, they already started.]

SMC released a statement Tuesday, saying they agreed with Dominguez's position that both SMC and San Miguel Holdings Corp. (SMHC) should undertake a Joint and Several Liability Agreement for the proposed Bulacan airport.

"As early as May 18, following the approval of the project by the NEDA (National Economic and Development Authority) board, SMHC conveyed to the Department of Transportation (DoTr) its willingness to execute the agreement as soon as the terms of the concession agreement (CA) are finalized with the government. The final CA will form the basis of what SMC will be guaranteeing and jointly liable for," they said.

The airport project would be fully backed by the financial capability of SMC, the statement said.

"Given the importance, impact and urgency of building a modern, world-class airport to the nation and the Filipino people, SMC and SMHC will abide by the demands of the Department of Finance (DoF) to ensure the project takes off," it added.