The Cagayan de Oro Bulk Water Inc. (COBI) urged the Cagayan de Oro City Water District (COWD) to ensure the timely payment of its monthly invoices and its adherence to its contractual obligations for the continued provision of essential water services.
In a statement, COBI said despite diligent efforts to maintain a cooperative partnership, it is deeply concerned regarding the persistent delays and the disregard of contractual obligations by COWD.
“The prolonged and chronic delays of COWD in settling monthly invoices, exceeding the contractual timeframe by around 30 to 45 days, has created challenges for COBI and its ability to fulfill its financial obligations to banks and suppliers,” the company said.
The water firm said COWD also refused to pay at the agreed-upon bulk water rate as stipulated in their Bulk Water Supply Agreement (BWSA).
While their contract mandates automatic adjustments to bulk water rates effective from January 2021 through December 2023 and subsequently from January 2024, COWD has consistently remitted payments based on outdated rates, COBI said.
The water utility explained the automatic adjustments simply account for inflation and movements in the cost of goods and materials.
“In light of COWD’s persistent disregard of its contractual obligations and the adverse impact on COBI’s financial standing, COBI is constrained to take the difficult decision to discontinue bulk water supply to COWD as outlined in their BWSA. While regrettable, this course of action is necessary to uphold the integrity of their agreement.”
“COBI remains committed to providing high-quality water services and looks forward to resolving the challenges with COWD to ensure the continuous provision of essential water services to the city,” the company added.