Saturday, October 14, 2006 Tomas ok with Neda nod on Carmen project By Linette C. Ramos Sun.Star Staff Reporter
SATISFIED with MCWD’s rejection of the P156-million project development cost refund, Cebu City Mayor Tomas Osmeña will not contest the second-pass approval given to the Carmen Bulk Water Supply Project.
But the mayor raised yet another issue and questioned the Metropolitan Cebu Water District’s (MCWD) capability to dispose of the water it will buy from Ayala Corp. and its partners under the proposed Carmen water project.
This time, the mayor expressed his apprehension on whether MCWD will be able to distribute up to 40,000 cubic meters of water a day.
Under the draft contract, MCWD has to buy a minimum of 39,000 cubic meters of water a day at P25.55 per cubic meter, whether or not it will be able to distribute it to the consumers.
The huge volume of water that will be supplied on a daily basis will be impossible to distribute, the mayor told a news conference yesterday.
With the increasing cost of water, consumers might decide to source water from deep wells instead of buying it from MCWD, he said.
“MCWD already made a stand that they will not allow the project development cost refund and I am satisfied with that. What I am apprehensive about is that even at P20 per cubic meter, whether MCWD can handle it,” he told reporters.
“Forty thousand cubic meters of water a day, to me, is impossible to distribute. My scenario is that if the prices go up, people will just build deep wells so the more they can’t sell 40,000 a day,” Osmeña continued.
In a phone interview yesterday, MCWD Board Chairman Juan Saul Montecillo said they will be able to absorb the 39,000 cubic meters, but they have to spend another P500 million to put up more pipelines from Liloan to other parts of northern Metro Cebu.
Water that will be sourced from the Luyang-Cantumog River in Carmen town in northern Cebu will be delivered only up to Liloan, as specified in the bulk water supply agreement.
Besides, Montecillo said, there are still other areas in Metro Cebu that are not served by the water district.
“If we can implement our investment plan and be able to spend P500 million for our expansion of the distribution facilities, we can absorb the water from Carmen,” Montecillo told Sun.Star Cebu.
He further said that if it pushes through, the bulk water supply agreement will spur economic development in the areas that will receive the water from Carmen.
“There are local government units that already have residential and commercial areas waiting to be developed, but there is no water available. Without water, no one will start any development project,” Montecillo said.
With a daily yield of about 142,000 cu.m., MCWD serves only around 50 percent of the total demand in Metro Cebu, which the water district has placed at 257,000 cu.m. this year.
About 50 percent of the total demand may be getting water from private wells or water vendors.
At present, MCWD has about 100,000 service connections.
Osmeña also alleged yesterday that the Carmen water project, an unsolicited proposal from the Ayala-led consortium, is “defective”, that is why the proponents are covering it up by muddling the relevant issues involved.
“They don’t want to face the embarrassment that their project is defective. The water is overpriced, so what they’re doing is they’re getting the challengers to increase the price by adding the project development cost,” he said.
Even if the issue on whether the consortium should be reimbursed its P156-million project development cost if it loses in the price challenge remains unresolved, the National Economic and Development Authority has granted the draft contract a second-pass approval.
This means that it has allowed MCWD to proceed with the price challenge, where other water suppliers can contest Ayala’s price of P25.55 per cubic meter.
The price challenge will be held once the consortium and MCWD settle the issue on the reimbursement, and once the National Water Resources Board publishes the price increase formula.
