Following the bidding process for the project which started October 2009, the Bases Conversion and Development Authority (BCDA), the government agency mandated to convert  former military bases in Central Luzon and Metro Manila, has awarded to the Manila North Tollways Corporation (MNTC) the right  to enter into the contract to lease, manage, operate and maintain the Subic-Clark-Tarlac Expressway (SCTEX). 

The SCTEX is a 94-kilometer tollway that interlinks Central Luzon’s three major economic zones – the Clark Freeport Zone, the Subic Bay Freeport Zone and the Central Techno Park in Tarlac. It was built by BCDA using a concessional loan from Japan International Cooperation Agency (JICA), formerly the Japan Bank for International Cooperation.

The MNTC, on the other hand, is the builder and concessionaire of the North Luzon Expressway (NLEX) to which the SCTEX has been seamlessly connected. The firm is a member of the Metro Pacific Group of Companies that is headed by businessman Manuel V. Pangilinan.

Under the terms of the contract which was awarded June 9, BCDA shall lease to MNTC the SCTEX and assign to it the concession to manage, operate and maintain the tollway for a period of 25 years, renewable for another 8 years.  BCDA also assigns to MNTC its toll operations rights under the Toll Operations Agreement (TOA) which BCDA signed with the Toll Regulatory Board (TRB) on June 13, 2007, including the right to collect toll revenues.

In return, MNTC shall pay BCDA a semi-annual lease/concession fee (SAL/CF) amounting to the peso equivalent of the yen-denominated JBIC/JICA debt service requirements for the years 2010 to 2016.

From 2017 to 2043, MNTC will pay, as lease concession fee, 20% of the gross revenues from the SCTEX, with the provision that if the lease concession fee falls short of the JICA debt service requirement, MNTC will advance the shortfall to BCDA without interest and recover the amount from BCDA’s future 20% share in gross revenues if it exceeds the debt service requirement.

Based on MNTC’s estimates, it will pay BCDA a total of P64.4 billion in lease concession fees for the concession period.  This amount is higher than the minimum requirement of P38 billion which BCDA set under the Terms of Reference (TOR) for the bidding of the operation and management (O&M) contract for the SCTEX. 

The bidding for the SCTEX O&M contract began in October 2009. Following the failure of the bidding on February 2010, after BCDA declared MNTC’s financial proposal as “non-complying,” BCDA, in line with the TOR, went into negotiations with MNTC, the lone eligible bidder, and later accepted the improved proposal submitted by the company. 

The BCDA and MNTC are now negotiating the details of the draft lease/concession agreement which is expected to be executed in 30 days, subject to obtaining the appropriate approvals of relevant agencies such as the TRB, OGCC and JICA.

As the SCTEX concessionaire, the MNTC will be responsible for, among others, the overall management and supervision of the tollway;  management of the toll operations center, toll plazas, and all other related ancillary facilities and equipment and the provision of appropriate resources to run the toll operations; implementation of a traffic safety and security management program for the entire stretch of the tollway on a 24/7 basis;  provision of an adequate patrol system for the whole stretch of the tollway on a 24-hour basis; provision of emergency response and incident management on a 24-hour basis in coordination with appropriate law enforcement agency; and maintenance of greenery and landscaping along the tollway.