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The Philippine Ports Authority is hoping to bid out by this first half of the year contracts to operate and manage the Iloilo and General Santos ports
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General manager Jay Daniel Santiago says PPA is finalizing the terms of reference for the two projects and hopes to bid them out “ideally” before June 30 but definitely within the year
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PPA is tweaking its Port Terminal Management Regulatory Framework with a view to bid out clusters of ports to stabilize the market for terminals in particular areas
The Philippine Ports Authority (PPA) hopes to bid out by the first half of the year contracts to operate and manage the ports of Iloilo and General Santos.
PPA is already finalizing the terms of reference (TOR) for the two projects and is hoping to bid them out “ideally” before the end of June but definitely within the year, PPA general manager Jay Daniel Santiago said in a press briefing on January 18.
Santiago said PPA already did its homework for the TOR of the two ports, which were earlier the subject of two unsolicited – and later withdrawn – proposals from the private sector. He said PPA just had to “make sure we update the data and we make sure that the data and the assumptions are reflective of the current situation now and any changes in assumptions moving forward.”
International Container Terminal Services, Inc. had earlier proposed to modernize Iloilo Commercial Port Complex and the Port of Dumangas in Iloilo province; and Kudos Trucking Corp. had offered to rehabilitate and develop General Santos port.
RELATED READ: ICTSI to submit soon requirements for proposal to develop Iloilo ports
Santiago had said earlier the proponents had withdrawn their unsolicited proposals because he believes they considered PPA’s Port Terminal Management Framework (PTMRF) “more expeditious” than the build-operate-transfer process.
Embodied under PPA Administrative Order 03-2016 issued in 2016, PTMRF outlines the guidelines for awarding terminal management contracts.
RELATED READ: PPA bares guidelines for awarding of port management contracts
Under AO 03-2016, investments in ports are to be categorized into six tiers, ranging from a fully private concession to a fully PPA-managed port. The framework has among its objectives promoting private sector participation in port operations to provide higher-quality service.
Iloilo and General Santos ports will be under Tier 2 of the PRMTF, which means the winning concessionaire will be responsible for the physical landside infrastructure (wharves, piers, land reclamation), above-ground semi-fixtures (cranes), above-ground fixtures (passenger terminal building, pavement, fence), and mobile-handling equipment (forklifts, trucks).
Under this arrangement, PPA will be responsible for the physical undersea infrastructure (capital, maintenance dredging).
Tier 2 ports have a 20-year port terminal management contract. So far, PPA has only awarded one port under Tier 2, the Davao port.
Under Tier 3, there are 18 ports that have been bid out and awarded since 2020. These include Puerto Princesa, Ormoc, Tabaco, Legazpi, Zamboanga, Iligan, Ozamiz, Calapan, Tacloban, Nasipit, Matnog, Fort San Pedro, Pulupandan, Surigao, Masao, Tagbilaran, Pagadian, and Pasig River ports.
Santiago had said earlier that PPA is looking at bidding out the port terminal management contracts of 25 ports this year. Aside from Iloilo and General Santos ports, other ports whose cargo-handling operators’ contracts have already expired and are on hold-over capacity will be up for bidding.
Santiago, meanwhile, said PPA continues to improve its PTMRF.
“Based on our experience bidding out 19 terminals, we need to tweak our regulation …because as we progress, we see certain gaps that we need to fill in,” Santiago said.
He said PPA will be doing clustering of terminals for bidding to stabilize the market for these facilities in each particular area.
Santiago explained that “not all terminals are constructed equally, so, if a better terminal increases rates, obviously some will start using other terminals, but most other terminals are not capable of handling [certain types of cargo and certain types of vessels].”
“So we need to cluster [to have] uniformity and stability in a particular area,” Santiago said, adding that this includes uniform fees and standard of operations.
He said tweaking the PTMRF will be done before bidding out the contracts for Iloilo and General Santos ports.
RELATED READ: PPA sees 600% more revenues under new port contract scheme
