A PROPOSAL to develop the international container port in Barangay Tayud, Consolacion was also offered by Mega Harbour to the Cebu Port Authority (CPA) in 2014, but it was rejected.
CPA General Manager Edmund Tan said businessman Reghis Romero of Mega Harbour Port and Development Inc. had proposed to undertake the project through a build-transfer-operate (BTO) scheme.
But because the terms of the proposal were all “detrimental” to the interest of the government and the public, the CPA rejected the offer.
The same firm was chosen by the Consolacion Municipal Government as its joint venture partner in the P16.4-billion port project in the same area where the CPA wants to build it.
Tan said Mega Harbour had proposed to reclaim 50 hectares of foreshore area to build a new port. It had offered to give to the CPA 15 hectares, which it could use for whatever purpose it wanted.
In exchange for the 15 hectares, Mega Harbour wanted the CPA to give to them at fair market value the existing 14-hectare Cebu International Port (CIP) for the company’s disposal or for commercial use.
“They will sell our existing CIP at a higher value to fund the construction of the new port. Parang ginisa kami sa sariling naming mantika,” Tan said.
Sun.Star Cebu tried to contact Mega Harbour president Victor Songco and Red Romero, but calls to their mobile phones were not answered.
In a phone interview yesterday, Tan said the firm had proposed that after the completion of the new port in two years, Mega Harbour would turn over the new port to CPA, but it asked for the exclusive right to operate it for 35 years.
In exchange for their right to operate the new port, it would give CPA a “royalty fee” of P50 million a year for 35 years, Tan said.
“At present, the existing CIP earns P500 million to P600 million a year, and yet when the new port will be operational, we will be given only P50 million by Mega Harbour as our share in the new port. With this, we already lose P500 million in revenues every year,” he said.
Mega Harbour also reportedly offered to add three percent of its revenue as additional fee to CPA every year, but this proviso came with a condition: only when the cargo volume of the new port reached one million Total Equivalent Units (TEUs).
“Right now, the cargo volume at the existing CIP is only 300,000 to 350,000 every year. Our projection, based on our study is that we will reach the one million TEUs of cargo only after 30 to 35 years or in 2045,” Tan said.
An additional demand of Mega Harbour was that the existing bulk handling facility at the existing CIP be taken over by Mega Harbour for their operation.
In their joint venture agreement with the Consolacion Municipal Government, Mega Harbour will reclaim 85 hectares, 35 hectares more than what it asked to reclaim in their offer to the CPA.
Of the 85 hectares, 35 hectares will be for the port, while 55 hectares will be for an industrial area. Of that area, nine hectares will be given to Consolacion.
All costs of building the international port will be shouldered by Mega Harbour, according to Municipal Legal Officer Paolo Crispin Sucalit.
The obligation of the Municipal Government is to help Mega Harbour get the approval of different government agencies, including the CPA.
The Municipal Government will also help negotiate with the owners of the lots that will be affected by the port project, but Mega Harbour will shoulder the cost of lot acquisition.
Mega Harbour, as reported by Malacañang after President Rodrigo Duterte’s visit to China last week, will undertake the port project with China Communications Construction Co. (CCCC), a contractor that was later found to have been blacklisted by the World Bank due to fraudulent and corrupt practices.
To the CPA, Tan said, the contractor’s track record has no significance because in the first place, both Consolacion and Mega Harbour have no legal personality to work on the project.
Tan and Rep. Raul V. Del Mar, considered the “Father of the CPA” as author of Republic Act 7621 (CPA Charter), said that only the CPA has the authority to undertake port projects.
“There is nothing wrong with Consolacion Mayor Teresa Alegado or any other municipal or city mayor and for that matter any individual or corporation to propose the construction of the international port,” Del Mar said.
“But it’s up to the CPA and other authorized national government agencies to approve their proposal subject to such pertinent terms and conditions and process and procedures as may be provided,” del Mar said.