BATANGAS City—State-owned Philippine Ports Authority (PPA) said it will privatize Phase 2 of Batangas Port before the year ends as the government needs to turn over the facility to private hands before next year’s elections.

“We have set a self-imposed deadline to award the contract [to the winning bidder] before the year ends,” PPA’s Port of Batangas manager Alex Cruz told reporters in a briefing on Thursday.

Razon-owned International Container Terminal Services Inc. (ICTSI) and Asian Terminals Inc. (ATI) have both met with PPA officials earlier this week for its prebid meeting.

Cruz said they can set the submission of the bids within November.

“The winner [of the contract] will be determined by the percentage of the variable fee that they will give to us [PPA] from their gross income [from operations of the port],” Cruz said.  “After they submit their bids, the decision to award the contract will not take long since we both know these two bidders.”

Both companies are the country’s two largest port operators.  Cruz said they have known their capabilities based on their previous experiences in the Port of Manila.

ICTSI operates Manila International Container Terminal, the country’s largest, while ATI controls Manila South Harbor, a port that handles both containers and bulk cargoes.

ATI, which operates Phase 1, operates the new terminal on a temporary basis, limiting its ability to market the facility to shippers.

As a result, the P5.5-billion facility remained idle more than a year after the government completed the rollout of cargo-handling equipment, such as the four rubber-tired gantries and two quay cranes. It only has one direct caller, but it is in danger of pulling out any time next year as a result of poor cargo volume.

“Phase 2 only handles less than 20 containers a month,” Cruz said.

The port is geared to become an alternative to Manila and can handle as much as 400,000 twenty-foot equivalent units a year.

The PPA said a legitimate port operator in Phase 2 of its Batangas Port could be the key for the growth of cargo volumes in the facility.

“There is a lot of wait-and-see going around the port. But they [shippers] are just waiting for a legitimate operator,” Raul Santos, PPA assistant to the general manager, said earlier.

Marianas Express, the lone caller of the Batangas Port, has already expressed its intent to further cut its weekly visit to the facility to twice a month after it failed to get its required volume from the shippers.

Last year various agencies such as the PPA, Philippine Economic Zone Authority and Bureau of Customs have joined forces to market Phase 2 of the Batangas Port as an alternative to the congested ports in Manila.

The agencies targeted some 30 percent to 40 percent of the current volume of the locators along the Calabarzon economic zone, or those areas covering the provinces of Cavite, Laguna, Batangas, Rizal and Quezon.