MNHPI seeks review of P14.5-billion contract

MANILA, Philippines - Manila North Harbor Port Inc. (MNHPI), the joint venture company between Romero-led Harbour Centre Port Terminal Inc. (HCPTI) and San Miguel Corp. (SMC), may ask for a review of their P14.5-billion, 25-year contract with government to operate and modernize North Harbor, including the value of the entire contract.

MNHPI chairman Mikee Romero said in an interview that the volumes that were stated by the Philippine Ports Authority (PPA) in the bid documents that were given to all interested parties then are “unrealistic.”

“Now that we are operating North Harbor, we learned that while the bid documents say that the passenger volumes are around two million, for 2010, it will only be around 1.5 million. In the case of cargo, it will only be 650,000 containers as against the 850,000 that PPA earlier said,” Romero said.

MNHPI is set to submit before the end of the year, a more concrete masterplan for the modernization and operation of North Harbor. “What we submitted before was a conceptual masterplan. By end of December, we will submit one that is more concrete,” he said.

He however emphasized the even the masterplan itself may have to be revised to take into account the reduced passenger and cargo volumes.

“Maybe we will have to do things more compartmentalized because it would be easier to expand than to have a huge facility that is underutilized,” he said.

The primary consideration for the new masterplan, which will basically have the same features as the conceptual one, will be the current volumes at North Harbor, which are lower, Romero said.

Romero stressed that they will have to look into the figures once more although they have already learned that they are basically the same even before MNHPI started operating North Harbor this year.

Asked why they did not check the figures given by PPA before entering into the contract, Romero said it was not possible to go around checking data inside the port at that time.

The volume of passenger and cargo given by the PPA in the bid documents were used as basis by the government agency not only for the bid price but also PPA’s share in the revenues.

The new masterplan may also include plans of SMC to put up a grains terminal facility at North Harbor.

Meanwhile, Romero declared that a large part of the complex has yet to be turned over by PPA to MNHPI, although the new PPA management has promised to do something about it immediately. It turns out that portions of North Harbor are still embroiled in legal controversies.

HCPTI owned 65 percent of MNHPI while SMC owns the remaining 35 percent. SMC acquired a stake in MNHPI after Metro Pacific Investments Corp. (MPIC) pulled out of the venture.

Manila North Harbor handles more than 85 percent of the domestic containerized and breakbulk cargo. North Harbor was officially turned over to MNHPI last April 12.

The first phase of the Manila North Harbor modernization program involves the redesign of the 10-pier port into a three- terminal port with much wider beds that would, all together, enable the port to improve its rate of handling containers, from the five containers per hour to 28 containers per hour. From 1.5 million TEUs capacity, MNHPI will increase the capacity to five million containers a year.

“This reflects more than 500 percent increase in productivity for the port, and renders substantial savings for shipping companies,” Romero said.

The 25-year North Harbor modernization program includes pier rehabilitation, dredging of port waterways, computerization, introduction of new cargo handling equipment and construction of a modern passenger terminal.

Terminal 1 and 2 will be the container terminals while Terminal 3 will be exclusively for general cargo. A separate modern passenger terminal will be built, rivaling those of other countries, to cater to domestic travelers.

Former Asian Terminal Inc. (ATI) president and COO Richard Barkley, Ramon Atayde and former PPA general manager Johnny Pena have been doing the masterplan for the last three months.