Lack of PPA consent delays freight train project

Right of way issues hampered the signing of a freight railway project between Philippine National Railways (PNR) and MRail Inc., a subsidiary of the country’s largest power distributor, Manila Electric Co. (Meralco).

At the Makati City venue of the supposed contract signing on Thursday, PNR general manager Joseph Allan Dilay told reporters that the deal was postponed since PNR had yet to iron out details with the Philippine Ports Authority (PPA). The latter regulates port operations such as those of Enrique Razon-led International Container Terminal Services Inc. (ICTSI), which will be the first to use the freight railway service.

The nonexclusive track usage agreement would allow MRail to use PNR’s tracks to move cargo between Manila International Container Terminal (MICT) to ICTSI-owned Laguna Gateway Inland Container Terminal (LGICT).

Pressed for details, Dilay said PNR still needed to coordinate with the PPA on the right of way issues affecting a small part of the track within MICT. While ICTSI is the contracting party, PPA still has to give its consent to projects in the port area.

He said the deferment would allow other relevant government offices, such as the PPA, enough time to study and prepare adequate representation in the signing of the agreement.

“There are no legal impediments to this agreement,” said Dilay. “The postponement is just to give us time to inform offices such as the PPA about the agreement. This way, when we do the actual signing, representatives of these offices will be here to witness this historic accord.”

Dilay said the contract signing could finally take place in about two weeks.

The agreement will allow MRail to operate a freight train service in the existing PNR tracks for a minimum of 8 round trips per day with an average daily container transfer of 600 twenty-foot equivalent unit (TEUs or total cargo capacity) from the MICT to LGICT and vice versa.

MRail president and CEO Ferdinand Inacay said the system would not interfere with the PNR commuter service plying the Tutuban-Alabang route. The freight train will be running 24 hours per day.

The freight train service is seen to support the manufacturing industry through the modernization of the country’s transport and logistics industry. Inacay said ICTSI had a freight train service in the 1990s that was halted in 2002. “Perhaps the service was ahead of its time,” he said.

He said the traffic congestion, truck ban and lack of new roads presented an opportunity to bring this service back into operation.

The existing PNR system provides an attractive and alternative mode to transport containerized cargoes. The system can effectively alleviate traffic in major Manila arteries while giving truckers a shorter turn-around time thus creating more trips per truck per day.

The agreement will also provide PNR the opportunity to improve its rail system while opening up other revenue sources to complement the commuter service system.