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Mindanao rail new feasibility study to proceed even without funding in place

THE Department of Transportation (DoTr) said it expects to proceed with the feasibility study on the adjustments that need to be made to the Mindanao Railway while the government searches for funding for the project.

“The phase one needs an updated feasibility study in order to update our figures and whether adjustments need to be made. The updated study needs an updated freight line in Mindanao, and because the cost of the project will be higher,” Jeremy S. Regino, undersecretary for railways, told BusinessWorld on Monday.

Phase 1 of the Mindanao railway project is estimated to cost P83 billion.

The project will run from Tagum, Davao del Norte to Digos City, Davao del Sur. It is expected to carry 122,000 passengers per day and cut travel time between Tagum and Digos from three hours to one.

Last week, Transportation Secretary Jaime J. Bautista said the DoTr will continue to work on the first phase of the Mindanao Railway project, pursuing some pre-construction activities.

The DoTr has said that it is focusing on securing right of way for the project while the government works to nail down funding.

The Philippines withdrew its request for official development assistance (ODA) from China for three railway projects, including the Mindanao Railway, citing lack of progress on financing.

“The feasibility study will also contain the study on the freight line since Mindanao is an exporter of goods. We hope that we will be able to finish the study by this year,” he said.

The feasibility study will also determine a viable funding strategy for the project, Mr. Regino said, “whether through ODA or PPP (public-private partnership).”

The Department of Finance has said that it hopes to finalize the funding options for the Mindanao Railway Project by this quarter.

The DoTr is also considering the viability of the Mindanao Railway Project Phase three, a 54.8-kilometer inter-city passenger and cargo rail line.

The third phase of the Mindanao Railway project will link Cagayan de Oro to Laguindingan, the site of the airport for the region, as well as Misamis Oriental. — Ashley Erika O. Jose