NO sooner had the Duterte administration announced the redevelopment of the 30-year-old Ninoy Aquino International Airport (Naia), seven conglomerates have expressed their desire to participate in the P74.6-billion Public-Private Partnership (PPP) Program.
The latest to join the fray was the Lucio Tan-dominated Asia’s Emerging Dragon Corp. (AEDC), which announced on Tuesday that the company is “participating in the bidding, because it believes in the growth potential of the Naia, given the company’s past experience of pushing for Philippine aviation development.” Tan owns Philippine Airlines (PAL) and built the Centennial Terminal, or Terminal 2, of the Naia complex.
It will be AEDC’s second attempt to redevelop the country’s biggest airport 24 years after it was edged out of the plan to build the third terminal by Philippine International Air Terminals Co. Inc. (Piatco).
The scandal-ridden airport project, which had Germany’s Fraport as partner, ran into series of difficulties that left Terminal 3 mothballed for over a decade.
The conglomerates that have announced their interest for the project include San Miguel Corp. (SMC), Ayala Corp., JG Summit Holdings Inc., Filinvest Development Corp., Megawide Construction Corp. and Metro Pacific Investments Corp.
“AEDC will have a foreign partner in bidding for the project that would ‘improve the operational efficiencies’ of the four Naia terminals, both landside and airside, to meet International Civil Aviation Organization standards,” said the company’s president, retired Gen. Salvador Mison, in a statement.
“We are participating in the bidding because we firmly believe in the growth potential of our country’s premier airport, given our past experience of pushing for Philippine aviation development.” He said AEDC is confident it can provide viable solutions to the Naia’s interterminal connectivity, as well as traffic congestion in the area.
AEDC’s foreign partner is expected to provide the technical expertise in its long-term proposal.
The National Economic and Development Authority (Neda) approved last month the Naia
redevelopment project purposely to upgrade the country’s main gateway airport.
President Duterte convened the Neda Board on September 14 to approve several infrastructure projects. The Naia redevelopment excludes any proposal to improve air-traffic services, according to the Neda.
The concession period is for 15 to 20 years, including the design/construction period.
Ramos’s idea
The idea of a new passenger terminal came from then-President Fidel V. Ramos in 1993, when he convinced the six Chinese taipans to pool their resources and finance the construction of a new international airport at the site of the former Philippine Air Force compound.
AEDC emerged from this brainstorming, which included Tan, Henry Sy Sr., Alfonso T. Yuchengco, George K. Ty, Andrew Gotianun and John L. Gokongwei Jr.
In 1994 AEDC submitted an unsolicited proposal to build and operate the Naia Terminal 3, but during the Swiss challenge, a consortium led by People’s Air Cargo (to be later known as Piatco, offered higher concession payments to the government, which AEDC was not able to match.
After the failure of AEDC against Piatco, Tan bought the shares of his partners so that now, he is the sole owner of the company.
Ang’s proposal
San Miguel President Ramon S. Ang is the original brain behind a new airport, which he proposed to construct on a reclaimed portion of Manila Bay. It would be located between the Sangley Point Airport and the Entertainment City on Macapagal Boulevard.
However, Ang’s proposal was turned down by the Aquino administration, which decided, finally, that a new airport would be built, complementing the existing airport facilities in Sangley Point, Cavite.
Sangley, used to be one of several American military bases in the country that include Clark, Subic, Mactan, Poro Point and others, and was the former headquarter of a squadron of the US Navy’s submarine-hunter P3 Orion.
As soon as the Duterte administration took over in June this year, Ang revived his proposed $10-billion airport on Manila Bay to solve air congestion and signal the Philippines is serious about boosting tourism and trade.
Ang said the plan would showcase a world-class international airport, earlier estimated to cost $10 billion but could be built for less, as well as a possible, unprecedented alliance with the country’s biggest conglomerates that would include Manuel V. Pangilinan’s group, Henry Sy’s SM Group and Zobel-led Ayala Corp.
SMC’s proposed airport would eventually replace the old Naia that is now operating beyond its intended capacity. The new airport would sit on 1,600 hectares of mainly reclaimed land in Manila Bay and was proposed two years ago to the outgoing Aquino administration.
SMC was careful not to offer to build the project due to the administration’s bias against unsolicited proposals and instead shared plans for a potential public bidding. Even then, the project never materialized.
‘Return to the table’
Ang told members of the media that the Duterte administration told him to renew his proposal and said: “So I’ll do this and will ask them to call for a public bidding. I’ll present all the designs.”
“If San Miguel were allowed to do the airport, I will invite Manny Pangilinan, and Ayala and Shoemart [SM Group]. All of them are welcome to be partners,” Ang added. “But as the major partner, I will invite Manny Pangilinan.”
For its part, Ayala Corp. managing director Rene Almendras said the company is studying the project and talking to both local and international firms which could serve as partners should it decide to bid for the project.
“We are definitely looking at it. I’ve actually been traveling. I met a few foreign partners abroad. Yes, we are looking. So there’s many people who will be looking. We want to make sure we put a good team. It’s a complex project,” Almendras said.
Last week Metro Pacific Investments Corp. Chairman Manuel V. Pangilinan said the infrastructure conglomerate is also looking to bid for the Naia project.
Japan International Cooperation Agency (Jica), which has been tapped by the Department of Transportation and Communications as adviser on infrastructure, suggested, following a feasibility study, to make Sangley Point in Cavite as alternate site.
Although Clark has often been mentioned as the logical replacement to the Naia, its distance of close to 100 kilometers from Manila was deemed too far for most Metro Manila residents since it lacked efficient mass transportation access. This also posed problems to some passengers, who had to connect to local or international flights, since the Naia has the majority of the international- and domestic-flight operations.
Studies have shown that alternate international airports should not be farther away than 60 miles from the original airport, citing some alternate airports, like in Canada, that have failed because of lack of airlines willing to transfer their operations.
“There’s really no other choice,” Ang said. He said Sangley could cost up to $20 billion to build, while SMC’s Manila Bay airport would require an equity of about $2 billion to $3 billion.
“We have experience to do the reclamation.We have dredging machines, everything is complete,” Ang added.
Today, SMC the private operator of Caticlan Airport, the gateway to Boracy Island. In 2014 it made an unsuccessful bid for the Mactan Cebu International Airport, with partner Incheon Airport of South Korea.
The Pangilinan-led Metro Pacific Investments Corp., the SM Group and Ayala also bid for the Cebu Airport PPP project that was eventually won by Filipino com-pany Megawide Construction Corp. and India’s GMR Infrastructure.
Jose Ma. K. Lim, president of Metro Pacific, said they were open to SMC’s offer if the government decision is to adopt Ang’s proposal, “we would consider it,” Lim was quoted in news reports as saying.
The project
The Naia’s redevelopment con-cession period is for 15 to 20 years, including the design and construction period. The Department of Transportation expects to begin PPP procurement upon Neda Board approval, and to award and sign a concession agreement by September 2017.
The Naia, which has two 11,000-foot long runways, is currently operating at maximum capacity with 40 landing and take-off per hour, blamed too many aircraft in operations. The limit in “events per hour,” is the total number of take-off and landing per hour. This could be increased to 55, according to NATS, the United Kingdom company bidding for the Naia’s air traffic-control system.
The Naia has another shorter and narrower runway, which runs across the main runway like an “X”, and used only when the taking off aircraft is facing Manila Bay, or when runway 06-24 is free of contrary traffic.
Modern airport designs have two or three parallel runway, either one or two could be exclusively used for landing and the other one for take-off.
1 comment
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Is there a problem with 4 parallel runways right on the NAIA present land?