SBMA may seek NSD contract exemption from election ban

THE Subic Bay Metropolitan Authority (SBMA) may ask the Commission on Elections (Comelec) to give the Naval Supply Depot (NSD) contract to the Romero business group after another company failed to submit its bid.

The Comelec forbids government agencies to award a contract prior to and after the May 10 national elections.

Harbour Centre Port Terminal Inc. president and chief executive officer Michael Romero said that awarding of Subic’s NSD contract will depend on the way the free-port authorities can convince the election body that the contract should not be covered by the election ban.

“Our offer is too high [for them to match]. ATI [Asian Terminals Inc.] did not match our $32-million offer,” Romero said. “Either we wait for the election ban or they get a Comelec exemption. But as of today, it [NSD contract] is not yet awarded to us.”

Earlier this year, Harbour Centre made an unsolicited bid to develop and operate the NSD, the terminal where general cargoes will be handled. The project will include the rehabilitation and operation of other specialized piers in the vicinity of the depot such as the Boton, Alava, Rivera and Bravo ports.

When SBMA opened the bid for a Swiss challenge, ATI, the country’s second-largest port operator, bought a document, but did not submit its bid. The Swiss challenge calls for ATI to at least match the current bid of the Romero group.

At the moment, there are about 13 companies listed in SBMA as bulk and break-bulk cargo handlers, but only nine are active players.

If the deal pushes through, all of these companies, employing about less than 1,000 people, will have to stop their operations and hand the facilities over to Harbour Centre.

According to figures, SBMA handled P2.21 million metric tons of noncontainerized cargoes in 2009, some 1.8 million metric tons of which are bulk and break-bulk cargoes, while the rest are transshipment, heavy-equipment, and other roll-on, roll-off goods.

Last year, SBMA earned P30.1 million from these nine active cargo handlers as its share of cargo-handling fees alone and some P8.5 million from warehouse rental and storage fees.

The terms of reference of the deal with SBMA show that the Romero-owned company assures the government of fixed fees of $500,000 or P23 million for the first year of operation, but these fees gradually go up to $600,000 for the second year until it reaches $1.5 million a year on the 25th year.

In total, SBMA said Harbour Centre committed $32 million or about P1.536 billion for fixed and guaranteed revenue share over the 25-year joint-venture period, while contender Mega Subic Terminal Services Inc. (MSTSI)-Amerasia’s improved proposal contained no such provision. MSTSI-Amerasia proposed a 15-percent share of cargo-handling fees, or a total income for the SBMA over 25 years of P740 million, based on current rates. Written by VG Cabuag / businessmirror.com.ph Reporter (With Jovic Yee)