Due to delayed toll hike, MPIC tollways units forego over P2B in potential revenues

MANILA, Philippines - The tollways arms of infrastructure giant Metro Pacific Investments Corp. (MPIC) are foregoing over P2 billion in potential revenues as the government has yet to act on the companies’ petition for toll hike.

Metro Pacific Tollways Corp. president Ramoncito Fernandez told reporters yesterday that the tollways arms of MPIC continue to forego potential revenues as the Toll Regulatory Board (TRB) has yet to act on the petition for toll increase over the past three years.

Both Manila North Tollways Corp. (MNTC) that operates the 86.7-kilometer North Luzon expressway (NLEX) and the Cavite Infrastructure Corp. that operates the 13.5-kilometer Manila-Cavite toll expressway (Cavitex) have pending petitions before the TRB.

In total, MNTC and CIC has lost P2.26 billion in potential revenues since 2012 due to the failure of TRB to act on their toll hike petitions. Both operators lost P147 million in 2012, P990 million in 2013, and would forego about P1.1 billion this year.

“It is over P2 billion for the three years in Cavitex and two years in NLEX,” he said.

The tollways arms of MPIC are seeking clarification from the government on the toll rate regime government the country’s major expressways.

According to him, the group is closely studying the viability of ongoing projects including the proposed P10 billion Segment 10 project.

“We would like to have clarity on the toll rate regime of Segments 9 and 10 so we can continue to defend to our shareholders our continuous investments on both roads,” Fernandez said.

MNTC is in the final stages of construction of Segment 9 of the NLEX Harbor Link project slated to open to commercial traffic by the first quarter of 2015. This segment features a 2.4-kilometer, four-lane at-grade expressway that spanning from the Smart Connect Interchange to MacArthur Highway in Valenzuela City.

Pre-construction activities for the elevated portion of the NLEX Harbor Link Project known as Segment 10 are progressing after the issuance of the notice to proceed to the civil works contractor last May 2014. The 5.6-km, four-lane elevated expressway would run from the terminal of Segment 9 in Valenzuela City and go south to C-3 Road/5th Avenue in Caloocan City above the alignment of the Philippine National Railways (PNR) tracks.

MNTC president Rodrigo Franco said the toll increase has long been overdue as the tollway is charging customers lower toll compared to when it started operating the NLEX in 2005.

Franco pointed out that the company charged P42 per entry for the open system and P2.48 per kilometer for the closed system when it started operations in 2005.

Currently, the company is charging motorists P45 per entry. Without the value added tax (VAT), the toll is only about P41 per entry for the open system and P2.38 per kilometer for the closed system.

“We hope people are going to understand why we have a petition for toll rate hike. Over the years, we even reduced our toll rates,” Franco said.

Operators and concessionaires of the NLEX, Cavitex, South Luzon Expressway (SLEX), and the Southern Tagalog Arterial Road (STAR) are seeking toll increases starting January.

MNTC sought an average of 15 percent toll increase for NLEX while CIC petitioned for a 25 percent hike for Cavitex.

On the other hand, South Luzon Tollway Corp./Manila Toll Expressway Systems Inc. (SLTC-MATES) petitioned a 33 percent hike while STAR Infrastructure Development Corp. (SIDC) sought a 16 percent toll increase.