Korean firm starts construction of Panguil Bay Bridge

President Rodrigo Duterte lays the time capsule for the Panguil Bay Bridge Project in Tubod, Lanao del Norte on November 28, 2018.

The joint venture group of three major Korean construction firms has begun the design and construction of the Panguil Bay Bridge Project in Tubod, Lanao del Norte.

The Department of Public Works and Highways (DPWH) issued the group a Notice to Proceed on Feb. 14, 2020 and civil works for the project officially started on February 28, 2020.

Joint venture contractor Namkwang-Kukdong-Gumgwang earlier advised DPWH of their readiness to start the detailed engineering, design, and construction with the mobilization of personnel and equipment on Friday, February 28, 2020.

“Hopefully the project will be completed before the end of 2022,” said National Economic & Development Authority Region X Director Mylah Faye B. Cariño.

Mega Bridge Program

The Panguil Bay Bridge project is the first listed undertaking of DPWH’s Inter-island Linkage (Mega Bridge) Program which involves the construction of a series of short- and long-span bridges linking island provinces to eventually connect Mindanao and Visayas to Luzon via land travel.

DPWH Secretary Mark Villar said the moving P1.7-trillion plan involves the construction of 17 short- and long-span bridges with a total length of 175,650 meters to be funded through a mix of foreign loans and grants, public-private partnerships, and the General Appropriations Act (GAA), a law Congress passes annually which defines the annual expenditure program of the national government and all of its instrumentalities.

.First dibs

The Panguil Bay Bridge is the first project under the master plan.

Once completed, the Panguil Bay Bridge will be the country’s longest at 3.77 kilometers, some 1.57 kms longer than the 2.2-kilometer San Juanico Bridge that links Samar and Leyte.

DPWH Undersecretary Emil Sadain, project director in-charge of DPWH UPMO Operations and Technical Services, said it is envisioned to be a two-lane bridge which would connect Tangub City in Misamis Occidental and Tubod town in Lanao del Norte that would drastically reduce travel time between these two points from two-and-a-half hours to seven minutes.

It will also shorten trips from the cities of Cagayan de Oro and Iligan to Tangub as well as the Zamboanga Peninsula Region.

Villar said bridges are key to developing the Philippine transport industry, as they are crucial in improving mobility and interconnectivity among adjacent cities and provinces.

Aside from spurring economic growth, bridges would also reduce the country’s estimated P3.5-billion daily productivity loss due to traffic.

THE Panguil Bay Bridge Project, to be financed through official development assistance from South Korea, broke ground November 27, 2018,

The $100.13-million loan for the project was obtained from the Export-Import Bank of Korea (KEXIM) in 2016 through a loan agreement with the Korean Economic Development Cooperation Fund (EDCF).

Cost overruns

The Panguil Bay Bridge Project was one of three bridges under the national government’s Build Build Build infrastructure program which incurred the highest cost overruns in the 2018 national budget due to high inflation and project changes, according to data released by the National Economic and Development Authority (Neda).

Neda’s Official Development Assistance (ODA) Portfolio Review 2018 report, total cost overruns—additional costs over and above the Investment Coordination Committee (ICC)-approved project cost—increased 264.02-percent to P24.79 billion in 2018, from P6.81 billion in 2017.

Inflation in 2018 averaged 5.2 percent with September and October posting the highest inflation rates of 6.7 percent in the year.

The change to the Panguil Bay Bridge Project and Integrated DRR was brought about by the increase in the length of approach roads and the width of the main bridge by a meter.

The scope of the project was also widened with an increase in the length of the pile foundations; borehole diameters; inclusion of a seismic design; and additional temporary facilities.

The changes increased the project cost of the Panguil Bay Bridge Project P2.52 billion (51.57 percent) to P7.38 billion from the ICC-approved cost of P4.86 billion.

Neda said the revised cost includes actual expenses for RoW [right-of-way] acquisition in Misamis Occidental and Lanao del Norte.

Reallocation

The project also had to re-allocate US$9,093,000 from Contingencies to Civil Works and Detailed Engineering & Design (DED) loan categories, since the original loan allocation for civil works and DED amounting to US$86,038,000 was deemed insufficient to cover the US$125,519,000 actual bid price of the winning civil works contractor.

“These changes in scope involved costs which required the concurrence and approval of the funders so it resulted in delays since negotiations involve time but hopefully with the notice to proceed and start of civil works we can now proceed with less of these delays,” Cariño noted.

The Department of Finance earlier requested the Export-Import Bank of Korea’s Economic Development Fund (KEXIM-EDCF) approval for the re-allocation while assuring the bank the US$9,093,000 shortfall resulting from this would be financed by the Philippine Government from its counterpart funds.

KEXIM subsequently approved the request as well as the Contract Agreement and Notice of Disbursement Limit for Design-Build of the project.

The remaining US$30,388,000 for civil works and DED contract shall be sourced from the national government’s counterpart funds, which has already been covered by the ICC approval in July 2018 of the DPWH request for change in the aforementioned scope and 52 percent increase in project cost. (compiled by RMB)

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