‘STILL ON TRACK?’: SONA promise on Panay Railways revival remains… a promise

By Joseph Bernard A. Marzan

The revival of Panay Railways was one of the hot topics here after the first State of the Nation Address (SONA) of President Ferdinand Marcos Jr. and recent developments indicate that it remains to be seen whether works would happen any time soon.

The Department of Transportation (DOTr) started the bidding process for the consultation services on the conduct of a feasibility study on January 26, 2023, according to its website.

The approved budget for the contract is ₱49.99 million.

Bid documents were opened on February 3, as livestreamed on the department’s Facebook page, which revealed the following bidders:

–       Urban Integrated Consultants, Inc.;

–       Angel Lazaro & Associates International (ALAI);

–       Engineering and Development Corporation of the Philippines (EDCOP);

–       Foresight Development and Surveying Company;

–       China Railway Design Corporation – Jinyi Consultant and Design Co. Ltd.; and

–       Rolando C. Siccion Surveying Office.

Out of these 6 firms, three were given a Notice of Eligibility and Shortlisting dated February 23 –ALAI-Systra Philippines Joint Venture, Foresight Development and Surveying Company, and EDCOP-SPACEM Design and Associates Joint Venture.

The notices stated that the feasibility study would entail “the financial and economic feasibility of undertaking the identified sub-components that would be integrated with the Panay Railway.”

But EDCOP-SPACEM Design and Associates Joint Venture withdrew its bid through a letter to DOTr Undersecretary for Planning and Project Development Timothy John Batan, chairperson of its Bids and Awards Committee (BAC).

The letter was dated March 15, which was also the date of the opening of the technical documents submitted by the two remaining bidders.

Both remaining firms submitted complete technical documents, but Daily Guardian found that these firms have had blemishes on their records.

ALAI has been tagged as ‘suspended’ by the Philippine Government Electronic Procurement System (PhilGEPS) in its portal as of this writing, and it was registered as a ‘Red’ member, which refers to the default registration status in the system and cannot bid directly on the PhilGEPS portal.

ALAI’s joint venture partner, Systra Philippines Incorporated, is of better standing being a ‘Platinum’ member and has an active PhilGEPS registration set to expire on July 2, 2024.

Foresight Development and Surveying Company, meanwhile, was suspended for a year by the Department of Public Works and Highways (DPWH) from participating in the procurement of consultancy services.

The suspension is mandated by DPWH Department Order No. 88 series of 2016, issued by then-Secretary Rogelio Singson on April 28, 2016, for violating the department’s ‘3-strike’ policy in procurement, but the exact reasons were unspecified.

The department order, however, did cite four infractions:

–       A bidder that had purchased bidding documents, but subsequently either (a) withdrawn from the bidding or (b) submitted a letter of non-participation, or (c) did not submit a bid without a valid cause, as determined by the concerned BAC;

–       A bidder submitting a late bid without a valid cause, as determined by the concerned BAC

–       A bidder submitting insufficient or defective documents, such as insufficient bid securities and other deficiencies; and

–       Other acts, which must have been indicated in bidding-related notices (Instructions to Bidders, Bid Bulletins, Notices, Minutes of Pre-Bid Conference, or other similar instruments) that tend to defeat the purpose of public bidding, as determined by the concerned BAC.

Daily Guardian has reached out to the office of DOTr Undersecretary for Railways Cesar Chavez for updates on the project, but while our message was indeed “read,” he has yet to respond.

SONA PROMISE

The Panay Railways revival was one of the projects mentioned in Marcos Jr.’s first SONA, along with the Mindanao and Cebu railway systems projects.

But the DOTr website postings indicated that the Panay Railways project is the first and only railways project to move forward, aside from existing projects of the previous administrations in Metro Manila and neighboring regions in Luzon.

Shortly after the President’s SONA last year, Chavez said that there was no money allocated for the revival and that it was not part of the priority projects of the department.

DOTr Secretary Jaime Bautista announced in January that they have secured $6 million for feasibility studies not only into the revival of Panay Railways, but also for the development of the Bataan Railway and the North Long Haul Interregional Railway.

Bautista also disclosed to online news organization Rappler recently that the department had also entered into other rail project-related contract packages totaling ₱300 billion, while a proposed loan from a Chinese firm for a Mindanao-based project had been plugged out, but he hopes that the firm could return to the table.

He, however, said that it would be impossible to see all railway projects finished during the Marcos Jr. administration and hoped that these would continue in the new administration by 2028.

Then-president Rodrigo Duterte also mentioned the Panay railways revival in his first SONA, and then-DOTr procurement undersecretary Raoul Creencia suggested studying the revival.

Three foreign companies had expressed interest in the revival, inking memoranda of understanding (MOUs) in 2018 with Chinese firms China Railways International and Shandong Dongyue International Trade & Economic Cooperation Co., Ltd., and another Malaysian company.

Reviving the region’s most prominent railway system had been proposed by the Regional Development Council since 2010, but this had been rejected by the late President Benigno Aquino III due to cost issues.

AS IT IS

At present, Panay Railways, Inc. (PRI) is still an active company under the Philippine Veterans Investment Development Corporation, albeit it is limited to managing its assets, which include all of the lots where railroad tracks used to stand and small surrounding land area, as well as its records.

There are two barangays prominently standing on the former rail track areas—the namesake Railway, and San Nicolas villages, both in La Paz district.

PRI Chief Operating Officer Cesar Capellan confirmed to Daily Guardian about DOTr’s feasibility study bidding, but it had not touched base with them directly.

Capellan said that since the president’s SONA last year, PRI has received 12 unsolicited bids from local and foreign companies for the railway rehab, the latest being the IIB Development Group based in Washington D.C. in the United States, which submitted its bid in August 2022.

The proposal, valued at $8 billion, includes engineering, procurement of rolling stock, and construction and funding works, for Phase 1 of the railway’s redevelopment, from Iloilo City to Capiz.

IIB Development Group’s website indicated that its projects in the Philippines include procurements of a bioethanol distillery in Bago City, Negros Occidental and of the Ganesha Resources Mining Corporation based in Pasay City.

This, and other proposals, have been submitted to the National Economic and Development Authority for their review.

The new railway system is expected to be different from its previous ones, which stretched from Lapuz district in Iloilo City to Roxas City.

The plan, according to Capellan, would be to stretch at-grade or ground level from Lawa-an in Roxas City to Santa Barbara, Iloilo, and would elevate to three above-ground lines going to the Port of Dumangas and the Iloilo Airport in Cabatuan.

The third line would be heading to Iloilo City, but Capellan declined to mention whether it would stretch to La Paz’s Railway village, where the PRI’s offices currently stand.

Iloilo City Mayor Jerry Treñas has raised concerns over the return of the railways to the city, citing lack of necessity and relocation issues, and suggested that they could use other areas, aside from the properties that PRI already owns.

There would also be an above-ground connection from Lawa-an to Culasi Port in Roxas City, and it is also expected to stray from the areas of the old line.

Like Bautista, Capellan also believed that formal physical works may start within the Marcos Jr. administration but it might not finish by the end of the term.