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Cebu airport proj seen viable under new bid rules

MANILA, Philippines - JG Summit president and chief operating officer Lance Gokongwei said the recent revisions in the terms of the proposed P17.5 billion Cebu International airport expansion project have improved the commercial viability of the project. 

“I think certainly that would be helpful to make it more attractive to private investors,” Gokongwei said.

JG Summit has tied up with Metro Pacific Investments Corp. (MPIC) to form the MPIC-JGS Airport Consortium. The group has tapped Aeroports de Lyon of France as its foreign partner.

“We’re working on it very closely with our partner, with Metro Pacific,” he added.

To improve the viability of the project, the government agreed to shoulder the payment of certain real property taxes and at the same time has extended the period of the concession agreement to 25 years instead of 20 years.

 It also agreed to transfer the operation and maintenance of the aprons from the grantors to the concessionaire including the right to derive revenue and to allow flexibility on the implementation of augmentation of capacity.

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 Likewise, the Department of Transportation and Communications (DOTC) agreed to increase the duration of the period for prohibiting competing from 10 years or when the passenger traffic at the airport reaches 15 million passengers per year to 20 years of when traffic reaches 20 million passengers per year for three years.

 The DOTC also prequalified AAA Airport Partners led by conglomerate Ayala Corp. and Cebu-based Aboitiz Equity Ventures together with Houston airport operator ADC&HAS as well as Filinvest-CAI Consortium of taipan Andrew Gotianun together with Singapore’s Changi Airport; Lopez-led First Philippine Airports together with New Zealand’s Infratil Asia Limited.

Other groups include the GMR Infrastructure and Megawide Consortium that includes India’s Delhi Airport; MPIC-JGS Airport Consortium composed of the tandem of infrastructure conglomerate Metro Pacific Investments Corp. and JG Summit Holdings of tycoon John L. Gokongwei Jr. together with Aeroports de Lyon of France;SM-led Premier Airport Group of retail magnate Henry Sy together with Switzerland’s Zurich Airport operators; and San Miguel-Incheon Airport Consortium of diversified conglomerate San Miguel Corp. and the operator of South Korea’s Incheon Airport.

The DOTC has scheduled the bidding of the project on Nov. 15. The PPP project aims to modernize the country’s second-largest aviation hub and the gateway to the Visayas with the construction of a new world-class international passenger terminal building with a capacity of eight million passengers.

The project also included the renovation of the existing terminal building that has been operating at over-capacity with 6.7 million passengers going through the 4.5-million passenger capacity structure in 2012.

 

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