DOTC to fast-track awarding of P64.9-B LRT1 Cavite Extension

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The Department of Transportation and Communications (DOTC) is looking to fast-track the awarding of one of its biggest public-private partnership (PPP) projects, the P64.9-billion Light Rail Transit (LRT) Line 1 Cavite Extension, also known
as the South Luzon Extension Project.

“We are studying it thoroughly, because if you will check the TRO, the restraint is on the common station, not on the award. So this is the biggest PPP project of our agency. [There is the] possibility of awarding despite the TRO,” Transportation Secretary Joseph Emilio Abaya told reporters.

Abaya was referring to the temporary restraining order issued by the Supreme Court barring the government from transferring the location of the proposed common station from its original location in front of SM City North EDSA to Trinoma Mall, which is owned by MPIC partner the Ayala Group.

The TRO reinforces SM Prime Holding Inc.’s position in the case it filed for Specific Performance of SM Prime and LRTA’s Memorandum of Agreement (MOA) dated September 29, 2009. The case is now pending before the Regional Trial Court of Pasay City.


Abaya added, “As soon as possible, as long as we check off our few concerns with the stakeholders: How it affects MRT 7, MAGA (Material Adverse Government Action) – the provision that whenever government is in default, it gets penalized — Office of the Solicitor General (OSG). Pretty much that is it.”

Asked if the DOTC could not award the project until it gets the legal opinion of the OSG, he replied: “It provides us legal cover. We are expediting, we are engaging them and we expressed to them that it is to the interest of the country that we are doing this.”

SM Prime earlier filed a lawsuit against government for changing the location of the common station to benefit a rival mall. It said it had an existing agreement with the government to build the common station for the three rail lines in front of SM North Edsa.

The government denied that it violated a 2009 agreement between SM Prime and the Department of Transportation and Communications, which oversees LRTA. It claimed that SM Prime’s naming rights over the project expired in 2011, even as it argued further that the new location would benefit more commuters.

The P1.4-billion Common Station is part of LRT’s North Extension Project which is expected to help alleviate the public transport shortage in Metro Manila.

LRT 1 currently runs from Baclaran to Roosevelt in Quezon City, while the MRT 3 runs from North Avenue in Quezon City to Taft Avenue in Pasay City.

The planned MRT 7 will begin at Tala, Caloocan City, passing
through Lagro, Fairview, Novaliches, Batasan, Diliman, and Philcoa, before ending at the planned common station at Edsa and North Avenue. The railway will serve an estimated two million commuters in the northern parts of Quezon City and Caloocan City.

The LRTA board in July had approved the award of the P64.9 billion LRT Line 1 Cavite Extension (Cavex) project to the Ayala-Metro Pacific joint venture, called the Light Rail Manila Consortium.

The consortium, lone bidder for the Cavex project, had offered to pay the government a concession premium of P9.35 billion for the right to build, operate, and manage the new rail line.

The consortium is made up of Metro Pacific’s Light Rail Corp. with a 55-percent share; Ayala Corp.’s AC Infrastructure Holdings, with 35 percent; and Macquarie Infrastructure Holdings Pte. Ltd., with 10 percent.

Already approved by the National Economic and Development Authority (NEDA), the LRT 1 Cavite Extension project is the biggest infrastructure project under the government’s Public-Private Partnership (PPP) program.

The Cavite or South Extension Project will extend the existing LRT Line 1, which covers 21 stations from Roosevelt Avenue in Quezon City to Baclaran in Pasay City. The Cavex will extend the service line by 11.7 kilometers, covering 10 more stations that will pass through the cities of Parañaque and Las Piñas up to Bacoor, Cavite.

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