LRT-1 contract overhaul gets $1-M backing
THE Philippine government has greenlit $1 million in technical assistance to restructure the Manila Light Rail Transit Line 1 Extension concession agreement.
Photograph courtesy of Light Rail Manila Corporation
The government is moving forward with the restructuring of the Light Rail Transit Line 1 (LRT-1) concession agreement after approving $1 million in advisory support to ensure the railway's financial sustainability and continued expansion.
The Public-Private Partnership (PPP) Center said its Project Development and Monitoring Facility (PDMF) Committee approved the Department of Transportation's (DoTr) request for transaction advisory services during a meeting on 23 October.
Review of proposed amendments
The funding will support a comprehensive review of proposed amendments to the LRT-1 Extension Operations and Maintenance concession agreement, including negotiations with private operator Light Rail Manila Corp. (LRMC).
According to the PPP Center, the engagement aims to ensure that the revised contract is "financially sustainable, legally sound, and consistent with applicable laws and government policies."
The advisory services will help the DoTr and Light Rail Transit Authority evaluate the proposed changes and negotiate the terms of the restructured agreement with LRMC.
Advisory cost to be shared
The $1-million advisory cost will be shared equally between LRMC and the government implementing agencies, subject to final terms and the execution of a trust agreement with the PPP Center.
The concession covers the operation and maintenance of the existing LRT-1 system, as well as the financing, design, construction, operation, and maintenance of its South Extension.
The restructuring is being pursued as the railway prepares to accommodate more passengers through its expansion toward Cavite.
Based on LRMC data cited by the PPP Center, the changes to the concession agreement.
LRT-1 served an average of more than 440,000 passengers daily as of February.