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Saturday, May 25, 2024

DOTr plans to privatize bundled MRT-3, LRT-2 operations by 2025

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The Department of Transportation plans to bundle and privatize the operations and maintenance of Metro Rail Transit Line 3 and Light Rail Transit Line 2 by 2025, an official said over the weekend.

“Our direction is 25 years to 30 years concession agreement for MRT 3, and we are studying to bundle it with LRT Line 2,” Transportation Undersecretary for Railways Cesar Chavez said.

“Our plan is to combine the good cake, and the not so good cake to make it attractive. We need to decide between now and July 2024,” he said.

Chavez said the build-lease-transfer agreement between the government and Metro Rail Transit Corp., the builder of MRT 3, would lapse by 2025.

He said once the government decides to bundle the two rail systems, MRT 3 would be transferred to the Light Rail Transit Authority which operates and maintains the LRT Line 2. Light Rail Manila Corp., a private consortium, operates Light Rail Transit Line 1 and is in charge of its expansion project.

The government operates MRT 3, while the MRTC, owned by Metro Rail Transit Holdings II Inc. led by businessman Robert John Sobrepeña, was responsible for the design and construction of the EDSA rail transit system.

Formed in 1995, MRTC started building MRT 3 in October 1996, completed it in December 1999 and started full operations in July 2020.

MRTC and the government through the Department of Transportation and Communications signed the BLT agreement in 1997 to construct and maintain MRT 3.

The partnership required the DOTr to hold the franchise and run the system, particularly the operation and the collection of fares. MRTC built the system, maintained the same to guarantee the availability of the trains at specified headway and specified hours and procured the required spare parts, while the government paid MRTC monthly fees for a certain number of years.

MRTC financed the construction of the modern rail system stretching along EDSA’s 10.5-meter median from North Ave. in Quezon City to Taft Avenue in Pasay City. The company infused P4.49 billion worth of equity into the project.

The train system was designed to carry more than 23,000 passengers per hour per direction, initially, and is expandable to accommodate 48,000 passengers per hour, per direction.

The LRT Line 2, on the other hand, was built at a cost of P31 billion in soft loans mainly from the government of Japan.

It is a 13.8-km mass transit line that traverses the cities of Pasig, Marikina, Quezon City, San Juan and Manila along the major thoroughfares of Marcos Highway, Aurora Boulevard, Ramon Magsaysay Boulevard, Legarda and Recto Ave.

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