Monetary Board okays $116.6-million MWSS loan

MANILA, Philippines - The Monetary Board (MB) has approved in principle the proposed $116.6-million loan of state-run Manila Water and Sewerage System (MWSS) from the Export-Import Bank of China to ensure a steady supply of water in Metro Manila, Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. said over the weekend.

Tetangco told reporters that proceeds of the loan would finance the second phase of the Angat Water Utilization and Aqueduct Improvement Project being undertaken by MWSS.

Last July 28, the MWSS awarded the second phase of the project to winning bidder China International Water & Electric Co. (CWE) which edged two other Chinese suppliers.

The Department of Finance (DOF) successfully negotiated the loan agreement between China Eximbank and MWSS.

Tetangco said the loan has a maturity period of 20 years including a grace period of five years and would carry an interest of three percent per annum.

The project would repair the leaks of the existing aqueduct AQ5 which, if not done, is poised to endanger the supply of 2,000 million liters per day of water for Metro Manila which is half of the 4,000 million liters per day total water supply for Metro Manila.

It also involves the construction of a new aqueduct AQ6 to serve as by-pass during the rehabilitation of AQ5 and to accommodate additional supply from Angat and Umiray River Basin.

The three-year project covers the construction of the remaining section of aqueduct AQ6 consisting of 9.9 kilometers including 5.5 kilometers of AQ6 that was constructed on January 2006 under Phase 1.

MWSS would also rehabilitate aqueduct AQ5 and at the same time interconnect AQ1 to AQ4 to AQ5 and AQ6.

About 97 percent of the 4,000 million liters per day supply in Metro Manila is coming from the Umiray, Angat and Ipo Dams. The water flows by gravity through a system of tunnels, basins, aqueducts and eventually channels down to the two treatment plants of La Mesa and Balara.

In January 2002, an inspection of the existing aqueducts revealed that about 13 leakages occur on some segments of the existing Bicti-Novaliches Aqueduct No. 5 that was constructed in 1990.

Three of these leaks were considered major leaks as it losses about 150 million liters per day. The 3 major leaks were repaired but leaks continue to surface on the other weak points of the existing aqueduct.