Built at a cost of $700 million, the project channels water from the Casecnan and Taan rivers in Nueva Viscaya and transport it to the Pantabangan reservoir through a 26-kilometer underground tunnel running through the Caraballo Mountains.
Testifying before the Senate Blue Ribbon committee, Sebastian described the Casecnan Multipurpose Irrigation and Hydroelectric Project as a landmark undertaking by the Philippine government guaranteed to bring net revenue of P143 billion to the country throughout its 50-year project life period.
"Had we pursued the original project concept to construct a high dam instead of a tunnel, we would have spent more and for a longer period of time. It would also have brought about unacceptable social and environmental repercussions by relocating indigenous peoples and floating thousands of hectares of forest land," Sebastian noted.
By accepting a proposal by CalEnergy International, an affiliate of the US-based MidAmerican Energy Holdings Co. (MEHC), for design and construction of the underground tunnel, the former agriculture secretary estimates that the country saved more that $1 billion in building fees alone while at the same time shortening the estimated period of construction by three to five years.