DOTC finalizing gov’t takeover of MRT 3

MANILA, Philippines – The Department of Transportation and Communications (DOTC) is now finalizing the buy out plan for the private owners of the congested Metro Rail Transit line 3 (MRT-3) as it seeks to include P53 billion in the 2015 budget for the complete government takeover of the mass transit system.

Transportation Secretary Joseph Emilio Abaya said in a statement that the agency is seeking a P53-billion appropria- tion in the 2015 budget to implement the equity-value-buy- out (EVBO) of the system’s private sector-owner Metro Rail Transit Corp. (MRTC) pursuant to the Build-Lease-Transfer (BLT) concession agreement.

“Government is still finalizing the details of its buy-out plan, but we will bring this to the private owner as soon as it is completed. The buy-out will pave the way for our long- term plans, which is intended to deliver not only a decent MRT-3 system to the public, but one that we can look forward to taking,” he said.

President Aquino issued EO 167 in March last year di- recting the DOTC and the Department of Finance (DOF) to implement the EVBO in order to put an end to the ongoing arbitration case between the DOTC and MRTC in Singapore.

The buy out would terminate the concession agreement, transfer full ownership of the mass transit system along EDSA to the government, and end the government’s obligation to pay billions of pesos in equity rental payments to MRTC annually.

Once the buyout is complete, Abaya said the DOTC would bid out the operations and maintenance (O&M) of the mass transit system to tap private sector efficiency and customer service orientation for operational needs.

He clarified that the government would retain regulatory functions for passenger protection.

A total of 11 projects worth close to P10 billion are being undertaken to improve the operations and decongest the MRT-3 that caters to about 550,000 passengers per day, way above its design capacity of 350,000 per day.

“The modernization and upgrading of MRT-3 is critical in order to improve our services to passengers in terms of both safety and convenience. Most of these projects will be completed in 2015 to 2016 under current timelines, which is why we are already pursuing them separately from the buy-out,” Abaya said.

The biggest project is the P3.76-billion MRT-3 capacity expansion project for the acquisition of 48 brand new trains that was awarded to CNR Dalian Locomotive and Rolling Stock Co. of China to increase the system’s capacity by 66 percent to 800,000 per day and reduce the waiting time for the arrival of trains for each station to 2.5 minutes.

The second biggest project is the three-year maintenance contract worth P2.2 billion replacing the current operator Autre Potre Technique (APT) Global to make sure that the mass transit system operates under safe running conditions and to maintain cost at a minimum level.