Tycoon Razon formalizes intent to build Cebu dam

A MANILA-BASED water utility firm has formally expressed its intent to put up a dam in one of Cebu City’s mountain barangays.

Melvin John Tan, chief executive officer (CEO) of Manila Water Philippine Ventures (MWPV), submitted a letter of intent (LOI) on the project to Mayor Michael Rama on Oct. 19, 2022.

The development comes after ports and casino tycoon Enrique Razon Jr., who is also chairman of Manila Water Company Inc. (Manila Water), spoke with Rama last September on developing a dam in the city. MWPV is a subsidiary of Manila Water.

“This is to formalize our intent to submit an Unsolicited Proposal for the development of a Bulk Water Supply project utilizing the Mananga River located within the jurisdiction of your city,” Tan said in his letter to Rama.

Tan said MWPV will submit its unsolicited proposal to the City Government in February 2023.

“We trust that you find Manila Water Philippine Ventures’ (MWPV) initiative consistent with your development objectives. It will be our privilege to expand and strengthen our partnership with the City Government of Cebu,” Tan said in the LOI.

Rama had earlier told reporters that the Mananga River, considered one of Cebu’s three protected watersheds, covers the cities of Cebu and Talisay.

The river has its headwaters in Cebu City particularly Barangays Sudlon 2, Bonbon, Toong and a portion of Barangay Pamutan where it drains toward Talisay City.

Rama met Razon during one of his “investment begging” trips to the National Capital Region to seek funds for the projects and programs of the city government.

After that trip last Sept. 13-16, his second investment begging trip, Rama said he had secured Razon’s commitment to fund and build a dam in one of the city’s upland barangays.

City officials who accompanied Rama on his trip said Razon would offer the water to the Metropolitan Cebu Water District (MCWD) for only P20 per cubic meter.

In 2019, MCWD had said it was buying water for P32 per cubic meter from a private supplier.

Razon also reportedly said the dam would be able to start supplying water to MCWD in two to three years’ time.

MWPV has existing subsidiary businesses in Cebu, Boracay, Clark, and Laguna.

One of these is Manila Water Consortium Inc. (MWCI), whose subsidiary Cebu Manila Water Development Inc. (CMWD), a joint investment firm with the Provincial Government of Cebu, provides bulk water in Metro Cebu by extracting water from the Luyang River in the northeastern Cebu town of Carmen.

CMWD supplies 35 million liters of water per day to the MCWD at P24.59 per cubic meter.

CMWD’s capital expenditure for the project is P1.33 billion.

Razon took over the reins of Manila Water from the Ayala group in June 2021 after Trident Water, a subsidiary of Razon’s Prime Strategic Holdings, plunked in an initial P10.7 billion for a 51 percent voting interest in Manila Water. The deal leaves the Ayala group with a 31.6 percent voting interest in Manila Water. (PAC / JKV, CTL)