PPA mulls returning lots to Batangas Port over payment of P11 Billion compensation to lot owners

Afraid to discourage prospective investors, the Philippine Ports Authority (PPA) mulls to return expropriated lots in Batangas Port than to pay the P11.7 billion as additional compensation to lot owners as ordered by the Supreme Court.

PPA general manager Atty. Oscar Sevilla said they could not afford to pay the amount and instead will just return the expropriated lots to its rightful owners regardless of its possible ill-effects to the project if the Supreme Court denied its motion for reconsideration.

He added that such measure is already included in their petition submitted to the Supreme Court. “The PPA could not afford to pay such amount as it will bleed to dry the coffers of the PPA that will stop whatever port development that is more vital to the movement of goods in an out of the country than Batangas Port;’ Sevilla said.

“However, we are keeping our fingers crossed that the Supreme Court will reconsider their decision. We believe that what we paid enough to the land owners and that the lots are agricultural in nature and contrary to the findings of the Supreme Court that it is commercial;’ Sevilla added.

Two weeks ago, the Supreme Court issued a status quo order on all affected stakeholders at Batangas Port pending final resolution of the case that seeks to pay 231 landowners a higher compensation pay for expropriated properties.

On August 24, Associate Justice Angelina Sandovai-Gutierrez, affirmed the earlier rulings of the Court of Appeals and Batangas Regional Trial Court, which set the expropriation price of the subject lots at PS,SOO per square meter. It likewise ordered the trial court to implement its final and executory orders requiring the PPA to pay the respondents the amount of PS,SOO per square meter or about P12 billion with 12% annual interest from the date of expropriation on September 11, 2001 until fully paid. PPA, on the other hand, insisted the value of the 1.3 million sqm (or 130 hectares) should be lower than P4,800 per square meter because they were agricultural lands.

To date, the PPA has deferred the submission of bidding documents indefinitely until the Supreme Court issues its final decision on the issue. The PPA is also set to meet with representatives from International Container Terminal Services, Inc. (ICTSI) and Asian Terminals, Inc. (ATI) to lure the two operators to continue to bid for port regardless of the final decision from the High Tribunal.

According to the Terms of Reference for the privatization of Batangas Port, the winning bidder will reimburse to the PPA the entire amount used for the development of Phase II of Batangas Port or its international terminal including the amount used in the procurement of several cargo-handling equipment that is set to be delivered towards the end of the year.

According to Sevilla, the Supreme Court decision will bumped total project cost to about P17 billion which he think is too high to lure other investors aside from ICTSI and ATI to come to Batangas considering its cargo traffic that is almost idle the past two years. He added that even eligible bidders ICTSI and ATI expressed hesitance to bid for the port if the additional amount will be placed on top of the original budget for the development of the port. Batangas Port is one of the 10 ports being groomed by the PPA to be at par with world standards by 2010. The PPA expects to corner some 10% of the estimated 400 million annual containerized traffic in the Asia-Pacific region by next year and increase the number by a modest percentage annually.

The Phase two of the Batangas Port, which was funded by a PS.S billion loan from the Japan Bank for International Cooperation, consists of dredging and reclamation, construction of two foreign container cargo berths, reconstruction of the general cargo berth at the Phase 1 area with provision for stacking yard, container freight station, terminal building, utilities, access road, and other support facilities.

Phase one of the Batangas Port development, mainly geared for domestic operations, started last 1992 and completed in 1997, which cost about funding of P1.21 B. It includes ferry, Roll-on Roll-off, and general cargo services. ATI has the contract for the Phase I.