DOTr seeks private sector support to finance transport projects
by Philippine Resources - May 15, 2023
Photo: Transportation Sec. Jaime Bautista speaks before businessmen at the Makati Business Club forum on Wednesday (May 10, 2023). He said that with limited public funds to bankroll such projects, the government could tap the assistance of the private sector. (Photo courtesy of DOTr)
The Department of Transportation (DOTr) is seeking the financing support of the private sector for the construction and implementation of transport projects and programs.
DOTr Secretary Jaime Bautista said that with limited public funds to bankroll such projects, the government could tap the assistance of the private sector.
"There are many government projects that need private sector's support because the government has limited funds," Bautista said at the Makati Business Club (MBC) forum titled "F2F with Cab Secs session" on Wednesday.
He identified big-ticket transport projects in the rail, aviation and road sectors where Public-Private Partnership (PPP) can be implemented.
He cited the proposed EDSA Busway privatization as one possible PPP effort, as well as the construction of Bus Rapid Transit (BRT) in Cebu and Davao.
"We ask the private sector to support the privatization of the EDSA Busway," Bautista said.
Bautista said the DOTr aviation projects in the pipeline include the improvement of the Ninoy Aquino International Airport, adding other airports in the greater capital for possible PPP proponents such as in Clark, Bulacan and Sangley in Cavite.
"We need additional airports to serve aviation requirements in Luzon," he said.
The transport chief said that the PPP will also be a huge lift for ongoing railway projects such as the North-South Commuter Railway, Metro Manila Subway Project, MRT-7, LRT-1 Cavite Extension Project and South Long Haul Project.
During the session, Bautista also shared his insights and experience working as a public servant.
"When you work with government you have to work not only 20 hours but almost 24 hours. There will always be supporters and detractors but at the end of the day what is important is you did your best, you work professionally with honesty and integrity, and with that, you should be proud of yourself,” Bautista said.
The session is part of MBC’s ongoing efforts to further strengthen public and private dialogue through connecting its members with the country’s key economic managers from the national government.
Article courtesy of the Philippine News Agency
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Marcelle P. Villegas - December 16, 2020
Test runs at max speed and other development for MRT-3
By Marcelle P. Villegas The newly overhauled MRT-3 train was tested by running it at a maximum speed of 50 kph. Here is a view from the driver’s compartment on MRT-3 during test run last 29 October 2020. (Screenshot from Department of Transportation video) MRT-3 or the Metro Rail Transit Line 3 conducted test runs on its first newly overhauled train. The train was tested to run at a maximum speed of 50 kph. According to Department of Transportation Assistant Secretary Goddes Hope Libiran, the train is composed of three cars which was overhauled by Sumitomo-Mitsubishi Heavy Industries. The company is the maintenance provider of MRT-3. The test run was documented in a video blog of DOTr. Libiran said, “As part of the massive rehab and maintenance of Sumitomo from Japan, we can now overhaul train cars that have been long neglected and now, we are repairing them under the Duterte administration.” According to MRT-3 Director for Operations Michael Capati, aside from the three newly overhauled train cars, the MRT-3 also plans to overhaul the remaining 72 cars by July 2021. “In the past years, our trains broke down plenty of times. Now, one of the things Sumitomo is doing is to rehabilitate and do a general overhaul of our trains.” Capati mentioned that the MRT-3 management wants its trains to run at 50 kph by November 2020.  He said, “We have already increased our train operating speed to 30 kph to 40 kph in October. Now we are using this train to simulate a 50 kph operating speed, which we are hoping to implement by November.” Capati noted that the improved train speed was made possible by the overhaul of train cars and the rail replacements that were completed last September. He also said that MRT-3 increased the number of its trains running daily to a maximum of 22. “Our maintenance program is doing well and at the same time, this is the effect of our rail replacements.” MRT-3 tested the train operating speed at 40 kph last September. This reduces the average waiting time of passengers from nine minutes to seven minutes. Reference:  Dela Cruz, Raymond Carl (29 October 2020). Philippine News Agency. “MRT-3 conducts test runs on overhauled train at 50 kph”. Article and photo credit retrieved from - https://www.pna.gov.ph/articles/1120153
Marcelle P. Villegas - December 14, 2020
Right-of-way ordinance for Makati Intra-City Subway project
By Marcelle P. Villegas Last 21 October 2020, Makati City government passed and approved an ordinance authorizing the acquisition of right of way covering the underground portions of nine roads that are affected by Makati City government’s subway project. As per Ordinance No. 2020-204, the roads that will be affected by the project are: Sen. Gil Puyat Avenue, South Avenue, J.P. Rizal Avenue, J.P. Rizal Extension, Pablo Ocampo St. Extension (Vito Cruz Extension), Kalayaan Avenue, EDSA (Epifanio de los Santos Avenue), C-5 Road (a.k.a. Carlos P. Garcia Avenue), and San Guillermo Avenue. The city ordinance mentions of subsurface right of way need to be acquired for the “staging, construction, operation, maintenance and development of the Makati Subway Project.” The nine roads mentioned above are in the road and bridge inventory of the Department of Public Works and Highways (DPWH). Therefore, they fall under the jurisdiction of the department. “Considering the importance of acquiring the easement of the right of way of the subject roads for the benefit of the citizens of Makati, the City Government of Makati is constrained to acquire, through voluntary agreement or expropriation proceedings, an easement of right of way of the subject roads.”  Section 19 of the Republic Act No. 7160 or Local Government Code of 1991 stated the authorizing of expropriations if needed. The City of Makati has entered into negotiations with and made a “valid and definite offer” to the DPWH for the acquisition of right of way. Philippine Infradev is building a subway that is worth $3.5 billion that shall traverse the central business district of Makati City. There will be 10 stations across the 10-kilometer line. Last September, Philippine Infradev signed a $1.21-billion contract that covers engineering, procurement and construction with China Construction Second Engineering Bureau Co. Ltd. For the subway project. The subway project is expected to accommodate 700,000 passengers daily in order to reduce the traffic congestion in the city. They are targeting the subway’s completion in 2025.  About the Makati Subway Project The Makati Intra-city Subway is a planned underground rapid transit line in the City of Makati that spans out to 11 kilometers or 6.8 miles. This is designed to link establishments across Makati’s business district. The project is a partnership between the Makati City Government and a private consortium led by Philippine Infradev Holdings. The subway line’s stations will be connecting the existing Line 3 (Guadalupe Station), the Pasig River Ferry Service, and the approved Line 9 (Metro Manila Subway). It was on 12 December 2018 when the preparatory work was commenced. On the same day, ceremonial drilling took place in front of the Makati City Hall. The Makati City Hall is near the site of one of the proposed stations of the subway. On this day, the signing of the memorandum of understanding also took place. The memorandum was signed by Makati City Government and a consortium consisting of Philippine Infradev and Chinese firms Greenland Holdings Group, Jiangsu Provincial Construction Group Company Ltd., Holdings Ltd. and China Harbour Engineering Company Ltd. Soil testing and feasibility studies of the proposed locations for the subway line’s stations were done as part of the preparatory work. By June 2019, 8 out of the 10 proposed stations have been finalized. The two proposed stations along Ayala Avenue are yet to be finalized due to “non-response” from its owners. The proponents said that they may divert the subway towards PNR Buendia Station or the Mile Long property in Legaspi Village instead. For now, the first station will be located at the Makati Central Fire Station. The fire station will be demolished. From there, the line goes towards a Lucia Tan owned property near Circuit Makati and Makati City Hall. The remaining stations will be located near Rockwell Center, Makati Bliss Housing in Guadalupe, Century City, University of Makati, Cembo and the final station will be near Ospital ng Makati. In July 2019, soil testing related with the subway project was completed. Philippine Infradev and the Makati City Government signed a joint venture agreement for the subway project. By October 2019, the plan to move the terminus of the line to the Mile Long property has been finalized. The area is being redeveloped by the national government along Amorsolo Street. The soil test results were favourable and the route diversion meant that the cost of the project might be reduced to as low as $2.5 billion. Moreover, a joint venture with Megaworld Corp. was made to build a common station in Guadalupe for the subway system and for the planned SkyTrain. Based on a disclosure to the stock exchange, the Philippine Infradev’s subsidiary, Makati City Subway Inc. (MCSI) received the term sheet from Megaworld Corp. This joint venture will build access to the Line 3 Guadalupe Station and the Pasig River Ferry. Philippine Infradev has an agreement with China Construction First Group Corp. Ltd. (CCFG) to build a transit-oriented development. Based on this agreement, CCFG is responsible for the construction, materials, manpower, equipment and other requirements to complete the project. The construction is expected to last for 42 months.  References:  Balinbin, Arjay L (25 October 2020). Business World. “Makati passes right-of-way ordinance for subway project”. Retrieved from - https://www.bworldonline.com/makati-passes-right-of-way-ordinance-for-subway-project/  https://en.wikipedia.org/wiki/Makati_Intra-city_Subway (Photo credit: IRC Properties Inc.)
Marcelle P. Villegas - January 12, 2021
Dept. of Energy: Moratorium on New Coal Power Plants
By Marcelle P. Villegas A moratorium on the endorsements of greenfield coal power plants was issued by the Department of Energy (DoE). This announcement was made while allowing foreign investors to now have full ownership of geothermal plant projects in the Philippines. DoE’s decision to stop the endorsements of coal power plants is the result of an assessment that showed the importance of focusing on a “more flexible” power supply mix. According to Energy Secretary Alfonso G. Cusi while at a virtual conference with world leaders held in Singapore, “This would help build a more sustainable power system that will be resilient in the face of structural changes in demand and will be flexible enough to accommodate the entry of new, cleaner and indigenous technological innovations.” DoE is currently updating their Philippine Energy Plan for the next 20 years. Mr Cusi mentioned that DoE is committed to accelerating the development of the Philippines’ resources while “pushing for the transition from fossil fuel-based technology utilization to cleaner energy sources to ensure more sustainable growth for the country.”  According to Undersecretary Felix William B. Fuentebella of DoE, the ban on endorsing new coal-fired power plants will not affect those power plants that have received endorsements in the past. He said, “We need to prepare for the influx of RE (renewable energy) under the recent policies issued by the DoE. Hence, the need for more flexibility.”  On note, 3,436 MV of committed coal-fired power projects in Luzon are ongoing as of August 2020. This includes the Meralco Powergen Corporation and GNPower Dinginin Ltd. Co. which is a joing venture of the Ayala and Aboitiz groups. Additionally, a 135 MW coal-run power projects in Visayas and 420 MV in Mindanao have been endorsed by DoE. Overall, there are around 10,000 MV indicative coal-fired power plant projects in the Philippines which may receive government endorsements. Mr Fuentebella said these will need to be sorted out. The ban will continue until the country will require additional baseload power, according to DoE official.  In relation to the ban, Center of Energy, Ecology and Development (CEED) pointed out that there are still environmental concerns about the existing coal-run power plants in the Philippines. CEED Director Gerard C. Arances said, “That is still concerning and alarming vis-à-vis pollution, climate imperative, and costly electricity in the country.” Another important announcement made by DoE is the upcoming open bidding round of renewable energy service contracts that will now allow foreign companies to own large-scale geothermal projects. This includes exploration, development and utilization. Last 20 October 2020, DoE released a circular providing the guidelines for the third Open and Competitive Selection Process (OCSP3) in the awarding of renewable project contracts. Cusi said, “From an investment perspective, OCSP3 allows for 100% foreign ownership in large-scale geothermal exploration, development and utilization projects.” DoE clarified that big geothermal projects are those with an initial investment cost of about $50 million and are under Financial and Technical Assistance Agreements, signed and approved by the Philippine President. Reference:  Ang, Adam J. (27 October 2020). Business World. “DoE bans new coal-run power plants”. Retrieved from - https://www.bworldonline.com/doe-bans-new-coal-run-power-plants/
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Philippine Resources - May 23, 2023
MEMORANDUM OF AGREEMENT SIGNED WITH TVI RESOURCE DEVELOPMENT (PHILS.) INC.
Photo credit: TVI Resource Development The Board of RTG Mining Inc. is pleased to announce that a comprehensive settlement of all outstanding issues with the Villar Family controlled Sage Capital and TVI Resource Development (Phils.) Inc. (“TVIRD”) has been reached and a binding Memorandum of Agreement signed. On execution of the final documents, expected in the next month, all litigation that RTG had launched will be withdrawn as part of an agreed restructuring of the Mabilo Project. The Villar Family is one of the most prominent families in the Philippines and RTG is pleased to partner with them in the development of the Mabilo Project, which is a significant mining project for the country. The key terms of the agreement for RTG include the following: RTG (through SRM Gold Limited) will retain a 40% interest in Mt. Labo Exploration and Development Corporation (“Mt. Labo”) with the project also developed by Mt. Labo, in line with Philippine regulatory requirements, with Sage Capital (which is owned by TVIRD) holding the remaining 60%; RTG will have a 2% net smelter royalty (“NSR”); RTG’s debt together with interest, currently in the order of US$27M (subject to audit) will be repaid out of the proceeds of Stage 1 of the project, the Direct Shipping Operation subject to customary requirements to address liquidity and ongoing operations of Mt. Labo; Funding arrangements for the project as between the major shareholders of Mt. Labo have been successfully renegotiated, (relieving RTG of a sole funding obligation) and replaced with a pro-rata funding obligation, together with a disproportionate funding obligation of Sage Capital, as set out below; With debt repayments in full and the NSR, RTG will be entitled to approximately 57% of the proceeds of Stage 1, the Direct Shipping Operation; RTG will be entitled to 40% of the operating cashflow of the project, together with the 2% NSR and repayment of its debt, which is currently in the order of US$27M; The first US$5M of expenditure for Mt. Labo (or 12 months of expenditure, whichever occurs the earlier), will be funded pro-rata between the two shareholders (ie RTG will provide 40%) and thereafter, Sage Capital/TVIRD will sole fund the next US$5M of expenditure, with all additional funding thereafter to be provided on a pro-rata basis; All parties are required to act in the best interests of the project and not compete; A shareholders’ agreement will be finalised which will provide typical minority interest protection clauses including reserve matters for voting including annual budgets and appointments of key personnel; Any disputes will be resolved by the Singapore International Arbitration Centre; and On completion of final signed documents, all litigation matters will be withdrawn and settled in full. With the restructuring of the Mabilo Project now agreed, over the balance of this year, the remaining permitting matters and financing plans will be finalised, a review of the 2016 Feasibility Study will be completed, together with finalising the acquisition of surface rights, following which, a commitment to development will be formalised by the Board of Mt. Labo. RTG is pleased with the outcome of the discussions and the co-operative and constructive approach adopted by the Villar Family representatives. RTG believes they can be a strong and positive partner to work with to take the Mabilo Project forward, with both a near term development and future exploration activities to expand the project, which will start to unlock the value of the project for all stakeholders, not only the local communities but for the country as a whole.
Philippine Resources - May 22, 2023
Mining Operational Excellence Through Digital Transformation
Part 1: Mining Operation Challenges and Mine Operations Management Domains 1 & 2. By Mae Ann Cabasag, EM Mining companies encounter numerous challenges throughout their operations. However, initiatives to mitigate these challenges and improve efficiency are often limited. Most of these limitations emanated from a common factor: the challenge of “poor visibility” in mining operations. A viable solution is to adopt digital transformation in mining operations by incorporating available real-time data into an integrated system— capable of ensuring automatic updates and reliable source of information. Through this, mining companies not only understand simulations and plans developed but also anticipate potential outcomes. Various mining industry analysts have found that using non-digital methods in the mining operations can lead to a 27% reduction in production time and 25% increase in data inaccuracy. For a mining company to remain competitive in an industry susceptible to operation challenges, i.e. production processes, workers’ and equipment performances, ore quality and quantity, compliance to regulations, and inter-departmental collaboration, it needs to embrace digital transformation. Dassault Systèmes Mine Operations Management provides transformative digital solution for mining companies to achieve excellence in their operations. Mine Operations Management (MOM) equips mining companies with an integrated system for their mining operations, enabling them to achieve efficient plan and schedule. This system integrates entire operation data into a single repository source of information, known as the “single source of truth”, ensuring complete transparency of the company’s processes from mine to port. By leveraging MOM, we can address the following global mining industry challenges: Maintaining competitiveness amidst market volatility. Eliminating waste materials, poor communication, and error duplication. Improving site productivity and efficiency. Utilizing assets and sharing best practices across the value chain. Ensuring an utmost level of safety. Reducing environmental impacts and achieving sustainable operations. The transformative digital solution, Mine Operations Management, is composed of eight work packages, split across four domains, namely: Data Management, Material Reconciliation, Operational Control, and Assets Performance. These domains help generate valuable insights from integrated operational data for rapid and informed strategic decision-making. The Data Management consists of Master Data Model and Integration Framework packages essential for material tracking, stockpile management, task and workforce management, machine performance, and asset maintenance. It enables users to manage master data objects such as Site, Material, Location, Equipment, and Operator through manual data entry or third-party source systems. With this, mining companies can ensure efficient and integrated management of critical data required for seamless operations. Material Reconciliation, on the other hand, consists of Material Tracking and Stockpile Management packages. Material Tracking enables us to track material movements across different stages, i.e. from the least accurate grade estimated in geological model to the most precise information on shipped material quantity and quality, to account for any inaccuracies. While in the Stockpile Management, users not only can calculate daily stockpile balance, add Survey or Sampling data, analyze inventory levels and trends, create graphical representation of the stockpile balances and movements, calibrate stockpile using volumetric survey and sampling, enables comparison of different models, track movement genealogy and review stockpile slices for stockpiles with LIFO and FIFO calculation type but can create a different type of analysis such as actual vs plan vs model. In the upcoming article, we will explore the two remaining domains of Mine Operations Management to where assigning operational tasks, tracking compliance to plan, monitoring equipment down to workers’ performance are feasible in the mining operations. To know more about MOM, mining innovations and solutions, contact Dassault Systèmes Value Solutions Partner: Paramina Earth Technologies Inc. through email@example.com References: Make it happen for mine execution excellence: Dassault Systèmes®. MEGATrends. (n.d.). https://events.3ds.com/make-it-happen-for-mine-execution-excellence Dassault Systèmes. (2021, August 12). Digging deeper: The virtual solution for Mining Operational Excellence. Dassault Systèmes. https://discover.3ds.com/virtual-mining-operational excellence dassault3ds. (2022, June 16). The mining industry needs to adapt, but how? Dassault Systèmes blog. https://blog.3ds.com/brands/delmia/the-mining-industry-needs-to-adapt-but-how/
Philippine Resources - May 22, 2023
Customer’s First Choice: Sandvik Philippines Delivers 11th and 12th Pantera DP1500i Drills to Filminera Resources Corporation
Sandvik Philippines has successfully commissioned and delivered to loyal customer Filminera Resources Corporation (“Filminera”) their 11th and 12th Pantera DP1500i Top-hammer Surface Drills last 25 January 2023 at the Masbate Gold Project (MGP) located in Masbate Island, Philippines. Photo shows Sandvik Technician Larry Lugnas (second from left) and Service Operations Manager Jorge Cabello (third from left) handing over the drills to MGP representatives. Located 360 km southeast of Manila, the Masbate Mine is operated by Filminera, the Philippine subsidiary of TSX- and NYSE-listed B2Gold with headquarters in Vancouver. In 2022, the mine produced a record-setting 212,728 oz of gold out of 7.93M tonnes of ore milled at an average grade of 1.11 g/t. B2Gold also operates the Fekola Mine in Mali and the Otjikoto Mine in Namibia. Their projects under development include the Anaconda Area in Mali and the Gramalote JV Project in Colombia. The Masbate Mine started operating in 2008 initially using 4 x Atlas Copco ECM660 Drills owned and operated by the erstwhile mining contractor, Leighton. When the opportunity for re-fleeting came about in 2012, Sandvik succeeded in winning the tender which came packaged with a full maintenance contract for 24,000 service meter hours of five years. Ironically, the said maintenance contract almost led to the cancellation of the order for the first 4 x DP1500i due to a dispute with the rates. Eventually, both Leighton and Sandvik were able to arrive at a mutually acceptable arrangement, and Sandvik ran the service contract for five years without incurring penalties in the availability guarantees. The contract was so profitable, Sandvik even had to share some of the residual profit at the end with Filminera under the pain-and-gain proviso of the contract. The next re-fleeting opportunity came in 2017, with the Masbate Mine. This time, there was no service contract attached to the equipment and Leighton was no longer the mining contractor; the mine has shifted to owner-miner operation. Sandvik managed to secure the repeat order for another batch of 4x DP1500i, banking on the proven performance and reliability of the first four. That brings the total to 8 units. Drill numbers 9 and 10 were ordered in July 2020 and delivered in 2021. Numbers 11 and 12 in the photo above were ordered in January 2022 and are now handed over to the customer. Filminera ordered two more DP1500i’s in November 2022; these machines are now awaiting completion in Tampere, for delivery later this year. That should bring the total to 14 x DP1500i units spread over 11 years for our most loyal Pantera DP1500i customer in the Philippines – Filminera Resources Corporation!
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