Manila Water, Maynilad join bidding for bulk water supply to Iloilo City

MANILA, Philippines - Metro Manila water concessionaires Manila Water Co. Inc. and Maynilad Water Services Inc. said yesterday they have joined the bidding for a bulk water supply project in Iloilo City.

In separate disclosures filed at the Philippine Stock Exchange, Ayala-owned Manila Water and Maynilad, a partnership between Metro Pacific Investments Corp. (MPIC) and DMCI Holdings Inc., said they submitted pre-qualification documents to join the bidding for the bulk water supply contract project of Metro Iloilo Water District (MIWD).

Manila Water said it has yet to receive formal confirmation from the MIWD of its pre-qualification for the project.

The MIWD was earlier reported to have pre-qualified five bulk water suppliers to serve part of the city’s 31,000 consumers and address a supply shortfall caused by system losses.

The three other entities that submitted pre-bidding requirements include Rio Verde Water Consortium, Abejo Builders Corp. and Solerez Water Technologies Inc.

Manila Water currently has an existing concession in the east zone of Metro Manila with a customer base of around 5.6 million people.  Since the start of operations in 1997, the company has already increased 24-hour water coverage to 99 percent from 26 percent and reduced water losses from 63 percent to less than 20 percent.

Sewerage coverage in the East concession area has likewise increased by more than 500 percent from only three percent at the start of the concession period to 16 percent at yearend 2008.

On the other hand, Maynilad, the private firm managing the water services of the western zone of Metro Manila, has recorded over 99,000 new connections since the MPIC-DMCI consortium took over in 2007.

The significant rise in service connections was attributed to Maynilad’s aggressive imnplementation of service improvement projects. Around P13 billion has been spent by the new owners to upgrade facilities and distribution network. For this year, Maynilad has set aside P7 billion for its capital expenditures.

As of end-June this year, Maynilad’s customer base has expanded to 777,160 service connections. By 2011, Maynilad hopes to provide 95 percent of the west zone with 24-hour, uninterrupted water supply.

Last week, the Cebu government accepted the unsolicited proposal of the Manila Water-led consortium for the development of a treated bulk water supply project in the province. Other members of the consortium include property firm Stateland Inc. and the Gaisano family’s Vicsal Inc.

The acceptance of the unsolicited proposal would trigger the detailed negotiations between the Cebu provincial government and the consortium regarding the specific terms and conditions that will govern their joint investment.

The submission of the unsolicited proposal was made pursuant to the joint investment ordinance issued by the Cebu government which recognizes the authority of the province to enter into a joint venture or investment with the private sector.

Manila Water said the joint investment activity shall be subject to a “Swiss challenge” or competitive challenge from other interested parties.

The cost of the project, which aims to distribute water to be extracted from the Luyang River in Carmen town to Metro Cebu through the Metro Cebu Water District, is estimated to cost over P2 billion.

Under the proposal, the consortium shall supply 35 million liters per day of potable bulk water to meet the growing water supply requirements of several northern cities and municipalities of the province. Currently, only 50 percent of these areas are being served.