SMC rolls out infra projects

The good news is… vital infra projects will soon be enjoyed by our people courtesy of private sector investor, San Miguel. The bad news is, actual use of the projects or actual start of construction depends on DOTC and CAAP giving the go ahead.

I asked Ramon Ang to give a progress report of his pending infra projects last Thursday in an informal kapihan with a number of columnists and editors. I was starting to get impatient at the seeming slow movement of SMC projects but he explained San Miguel is trying its best but has to wait for government to give its blessings or deliver commitments.

RSA started with the good news about Caticlan airport, the gateway to Boracay. It is all done, he said, the extended runway is ready to accept its first Airbus 320. What is keeping the airlines from using an Airbus instead of their turbo props is CAAP certification.

The new runway requires a new certification that it can accommodate an Airbus. RSA hopes he can get that by January. He said they are compliant with all the requirements including runway landing lights for night use and all necessary air navigation equipment.

When will CAAP certify Caticlan for Airbus use? Well, it is anybody’s guess. We all know how government agencies move. Let us see if CAAP will have much needed sense of urgency.

In the meantime, the airlines are still using their turbo props but already on full load. The old shorter runway requires them to fly at half load, which explains the rather expensive tickets to Caticlan. Maybe they should be giving passengers a discount now but that’s not going to happen soon. Government will have to tell them.

What San Miguel is still busy building at Caticlan is the passenger terminal. Bayani Fernando’s construction company is working on it and expects to complete it within the next 15 months.

RSA promised the new Caticlan terminal will be better than NAIA Terminal 3. It can handle 5 million passengers a year compared to the present terminal capacity of 500,000. It will also have 12 air bridges that work.

San Miguel is also starting to work on business type hotel accommodations in Caticlan so as not to overburden the island. People can just go to the island during the day and sleep in Caticlan at night. Conventions can also be held in Caticlan.

RSA also announced they are ready to break ground for the long delayed $2 billion MRT-7 that will run the North EDSA- San Jose del Monte route. San Miguel has submitted all the necessary documents to DOTC, from financial closure to signed construction contracts, and they only need DOTC to say GO AHEAD.

On the NAIA Expressway, San Miguel is looking at an April 2016 completion. The delay is apparently because government failed to deliver the right of way on time. San Miguel refused to confirm a story I heard that even government agencies, like the Air Force delayed right of way delivery. Under the PPP contract, right of way delivery is a responsibility of government.

The horrible traffic problem in the construction area, notably at Andrews avenue in front of NAIA 3 is also another cause of delay. The construction crews cannot freely move in materials and equipment. They have also been asked to stop or slow down work now and then.

I asked RSA if he would take responsibility for traffic management if it was given to him and he said yes. He had some good ideas to ease traffic. If I were MMDA or Secretary Rene Almendras, I would offer RSA the responsibility of managing traffic in the project’s construction area.

Airline passengers regularly miss flights and really suffer physically and mentally from the horrible traffic gridlock experience. Passengers alighting from stuck cars and dragging their luggage a few kilometers to the terminal is common sight.

I suspect the problem also has to do with so many government agencies involved in managing traffic flow. There is the MMDA, the DPWH and the NAIA airport officials. The local barangay traffic aides and local traffic officials from Pasay City all want to have their say.

At this point, there is nothing to lose if the traffic management responsibility is given to the private company involved in the construction project. There is more incentive for San Miguel to make sure there is better traffic flow than the public officials pretending to know what they are doing.

But San Miguel must be given a free hand and total authority over the traffic aides whose primary mission, it seems, is to earn their boundary from motorists than manage traffic.

On the NLEX-SLEX connector road, San Miguel is pushing to complete the project by early 2017. Again, there are some right of way problems for the access ramps. But they assured once all the pilings are done, the project will move faster on the road to completion. Two reputable contractors are working from both ends of the project. They will also open portions as completed so that the public can benefit earlier from the traffic relief the project will bring.

The Sto Tomas to Lucena expansion of SLEX is also about to start. That segment is 50 kilometers long. RSA related that during a recent weekend, he decided to drive from Pagbilao to Manila and it took him over  four hours. Bypassing San Pablo and other urbanized towns along the way via the expressway extension would benefit agriculture and tourism in the area.

As for TPLEX, San Miguel expects to complete the expressway all the way to Rosario, La Union by end 2016. 

RSA was also excited about the latest project they won: the Bulacan bulk water. They will soon start laying out pipes and build a water treatment plant to benefit the province of Bulacan. It is ironic that Angat is in Bulacan, but the province is dependent on underground water for domestic purposes.

Of course, RSA is most proud of the completion of Petron’s $2 billion rehabilitation of the Petron refinery. That means, they will now be able to extract almost a hundred percent white petroleum products (gasoline, diesel, etc) from every barrel of crude processed. In the past, 40 percent of the barrel ends up as low value industrial fuel oil.

Regarding his proposed new international airport at the Cyberbay reclamation area off Roxas boulevard, RSA said he plans to present it again to the next president. He is hopeful the next administration will be more receptive to a proposal that entails no government funds and completely a private sector risk.

On the partnership with Telstra, he said they are still talking. But he insisted, the project is going to proceed with or without Telstra. He said that even now, San Miguel is building cell sites all over the country for a pure broadband technology that leapfrogs the current telcos. My source in NTC confirmed that claim.

So, when will this long promised disruptive telco enter the market? RSA could only say soon, something I have heard a number of times in the past. I was hoping he would be more definite, like next year. Because it is widely anticipated, he may end up sounding like DOTC, you know, promises, promises.

I asked RSA how the rise in interest rates in the US and a decline in the peso’s value will affect San Miguel. He said they are now working to convert their dollar denominated debts into peso and hope to complete the process by the first quarter of next year.

On the whole, it felt good to know that local infra is moving somehow even if DOTC and other government agencies are not too enthusiastic to launch projects. As expected, it is the private sector that is moving.

A good advice to the next administration is to get out of the way and just be supportive, if it is clear the private sector can do a better job. Once the private sector is allowed to work on a project, government should cooperate wholeheartedly by making it easy to get permits and delivering rights of way on time.

One project that is languishing even if much needed is Metro Pacific’s version of the connector road over the PNR right of way. Nothing has happened probably because this administration isn’t fond of MVP. Notice how the SCTEX project went back and forth, even after MPIC conceded every government demand. It ended up with a Swiss Challenge.

MPIC’s connector road project is important because it connects to the piers and will take a lot of trucks out of our surface roads. The segment of NLEX leading to the piers is now under construction. Government is now saying this MPIC project must also go under a Swiss Challenge. Well… get that challenge done so work can proceed.

Boo Chanco’s e-mail address is [email protected]. Follow him on Twitter @boochanco