Philippines to seek bids for $988-mln water infrastructure deals

MANILA, June 10 Tue Jun 10, 2014 2:52am EDT

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MANILA, June 10 (Reuters) - The Philippine government will start auctioning off two waterworks infrastructure contracts this month worth an estimated 43 billion pesos ($988 million) under its public-private partnership (PPP) programme, a senior official said.

The debut of utility projects in the administration's PPP scheme comes as the government adds more road, airport and railway tenders into its cornerstone programme, which is aimed at addressing an infrastructure backlog.

Invitations to bid for the water projects will be published this month, Cosette Canilao, executive director at the state agency reviewing PPP projects, said at an investors forum on Tuesday. Bidding will be open to both local and foreign firms.

To be auctioned off is the 24.4-billion peso Bulacan Bulk Water Supply project, a 30-year contract to build and operate facilities for treated bulk water in Bulacan, an industrialising province north of Manila.

Also up for grabs is the 18.7-billion peso New Centennial Water project. It involves constructing a dam northeast of the capital to help ensure water security in one of the world's most densely populated and fastest growing cities.

Metropolitan Manila's nearly 12 million residents suffer water service interruptions, especially during the El NiƱo dry weather season, as the capital relies solely on the four-decade old Angat water reservoir system.

The contracts could be awarded in the first half of next year.

"We cannot let these projects not explode into full bloom," Gerardo Esquivel, administrator at state-owned Metropolitan Waterworks and Sewerage System, said at the same forum.

Canilao also played down investor concerns, like right-of-way acquisitions and risks that future administrations will not honour contracts.

"There's a cost recovery system," she later told reporters, adding that a measure putting more teeth into a law governing joint public-private projects is now being reviewed in congress.

An interagency-body headed by President Benigno Aquino is set to approve this month more PPP projects, paving way for bidding later this year.

Set to be approved are bundled airport tenders and construction of an expressway south of Manila, which is set to become the most expensive state infrastructure contract at 122.8 billion pesos, Canilao said.

($1 = 43.6600 Philippine pesos) (Reporting by Siegfrid Alegado; Editing by Kim Coghill)

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