The P700-Million Peso Mistake

In the old past, the Pulupandan port which is some 25 kilometers south of the capital Bacolod was the main port of Negros Occidental province. It came to be located there because Bacolod has no way to build a deep-water port the because of the shallow slope of its beaches. And for export of sugar, the Negros sugar barons even developed a terminal in Guimaras before the war where foreign ships can dock and load sugar for export.

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From the NENACO Anniversary book

There was not much controversy was found before in Pulupandan being the main port of Negros Occidental. For the short hop to Iloilo the then smaller ferries were able to dock in Bacolod wharf. But for liners to Manila after the war, Pulupandan was the port and even the shipping company founded by Western visayas interests which did exclusive Western Visayas routes, the Southern Lines used Pulupandan port. All liner companies then used Pulupandan port.

Things changed in the 1960’s when Negros Navigation was already “the” Western Visayas shipping company and the company was plotting its rise and it was loaded with political connections. 1960’s was also the decade when from mainly having small and shallow draft ex-FS ships as the primary workhorse for shorter distances, the ships started to get bigger because maybe the population was growing fast and maybe also the economy was also developing because of the population increase (but of course not in a qualitative way – it was still plow and harrow technology of the old ages and mainly tilling of land in individual plots).

For their bigger ships now, Negros Navigation decided to have a new port which turned out to be the Banago port. This port was located in government-owned foreshoreland on a build-operate-transfer (BOT) lease of 50 years.

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Banago port (from “docdoms” in Photobucket)

Banago port was a big success for Negros Navigation. How can it not be when it was located right at the capital and commercial center and Pulupandan is some distance to the south? As a private port, Banago was exclusive to the ships of Negros Navigation as they were the owner and operator of that.

Pulupandan port was then left to decay slowly and get shallow as the years went by. Being near an estuary did not help its case and in any case as the years went by dredging has to be done on ports so the depth will be maintained as silt will naturally accumulate due both to human and natural causes.

The other shipping companies like Sulpicio Lines, William Lines, Lorenzo Shipping and Compania Maritima still used Banago port until the early 1980’s by using the shallow draft ex-FS ships and other vessels of the same size and draft. But in the same decade these types were gone in Pulupandan and there was no way they can still dock their bigger ships there now. And so one by one they abandoned Pulupandan and not even their new container ships called there and Pulupandan completely lost its liners from Manila.

The 1980’s started with Negros Navigation having practical monopoly of shipping to Negros Occidental aside from the occasional small general purpose ship calling in Pulupandan which remained operational and the attempt of Aboitiz Shipping to use Sipalay port in the southern part of Negros Occidental as alternative. So when one has to go to Bacolod by ship (which was much cheaper than the expensive PAL plane then), one then has to go to the nearest negros Navigation ticketing office or booth.

But things never lie still and in the 1990s, the Bacolod Real Estate and Development Company (BREDCO) applied for a reclamation permit with the purpose of building a port. That was subsequently granted and the new BREDCO port slowly began to take shape. When it became operational it was obvious that its design and capacity is much, much superior than the Banago port of Negros Navigation. And that was why I wondered why after so many decades Negros Navigation didn’t care to build a port that is comparable and that they will own forever.

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BREDCO Port (from “docdoms” in Photobucket)

When the merged shipping company WG&A came into being and it wanted to challenge Negros Navigation in its own turf, they had BREDCO which they can approach. BREDCO port served WG&A ships and in an instant the monopoly of Negros Navigation in Bacolod and Negros occidental was suddenly broken. And the competition situation was WG&A had more and better ships than Negros Navigation. If not for the Negrense’s loyalty to Nenaco, WG&A would have pushed Negros Navigation to the brink more rapidly.

In retaliation, Negros Navigation also entered the home turf of WG&A which is Cebu. But they were never particularly successful there as they were like facing three combined shipping companies there especially in cargo and let us not forget that Cebu is also the stronghold of the Number 1 before the “Great Merger” which was Sulpicio Lines. Negros Navigation never really the quality of the great liners serving the Cebu route and so competing there was very tough for them.

Soon BREDCO portwas a roaring success. Not only did it host liners from Manila but also container ships. With the development of the intermodal system, the Bacolod-Dumangas short-distance ferry route took off and not only that the HSC (High Speed Craft) route between Iloilo and Bacolod really took off also and in its wash it even sank the Iloilo-Bacolod short-distance ferries of Negros Navigation which they served since their inception in 1932. By this it was all too obvious that Banago port is no match to BREDCO port in location and in facilities. Well, it was also even able to develop a grain and an oil terminal. They have it all including all the assortment of charges, too to better fund their expansion.

It was obvious then that BREDCO was just a good commercial port and not much more and not even protecting Negros Navigation interests which at the start of the new millennium its fortunes are ebbing fast. Soon Negros Occidental politicians had grumblings against BREDCO to maybe shake up its roost and effect changes. But no dice. BREDCO simply shrugged off all pressures and cases filed. Soon even the Negros Navigation hold on Banago port was gone because their 50-year lease already expired and they have to return the foreshoreland and together with it surrender the port to the government which happened during President Aquino’s term.

When the return of Banago port was imminent, the Negros Occcidental politicians tried to have a government port that will compete with BREDCO. But then all their brain wracking produced just one lousy idea, the re-development of Pulupandan port into a port worthy of regional port standards and for this they committed a budget from the peoples’ coffer of over P700 million. And with that money a new modern port rose in Pulupandan.

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Pulupandan Port (Photo from BizBilla.com)

Which soon turned practically into a “port to nowhere”. No liners came nor container ships. Just few occasional small freighters will come just like before. The government tried to sell it as a connection to Guimaras. After prodding, the Montenegro Shipping Lines responded and fielded a Pulupandan to Sibunag short-distance ferry-RORO. But then that solitary ferry is no match in weight with all the HSCs and short-distance ferry-ROROS using the BREDCO to Iloilo and Dumangas routes. There was simply no way to compete with the much superior location and development of BREDCO port. It was just like developing Cavite port to compete with North Harbor or developing Argao port to compete with Cebu port.

Now there is pressure to develop a new government port in Bacolod to compete with BREDCO. Huh? I thought it was the mantra of government not to compete with private enterprises (by the way, I am not the defender of BREDCO nor do I have any connection with them; it just titillates me to twit government stupidity), Why don’t they just tow the Pulupandan port to Bacolod to save on cost? Now, if that is only possible so the mistake can be corrected. And where was the stupid NEDA (National Economic Development Authority) in all of this when it should have checked well the validity of government projects? Will the proponents and validators of the Pulupandan port project willing to have their necks garrotted?

Now imagine another regional port in Bacolod costing about a billion pesos to build including land to be purchased just to make up for the Pulupundan error and compete with BREDCO!

When one Negros Occidental congressmen questioned that project, the main proponent which is one of the richest men in Congress simply said he will try to have a similar port in another congressional district north of Bacolod and the congressman which questioned was mollified. Well, with “solons” like this maybe it is high time we close Congress and better just save the money.

And that is the P700-million peso Pulupandan mistake which they will try to remedy by throwing good money after bad.

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The Matnog Ferry Terminal

The government ports that were built in the 1980’s to connect Luzon, Visayas and Mindanao through the eastern seaboard of the country were not called “ports” but instead were called “ferry terminals”. And so it became Matnog Ferry Terminal, San Isidro Ferry Terminal, Liloan Ferry Terminal and Lipata Ferry Terminal. The four actually had a common design in their port terminal buildings and general lay-outs. The paint schemes are also the same.

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Matnog town had been the connection of Sorsogon and Luzon to Samar even before World War II and it might even been before the Americans came. That situation and importance was simply dictated by location and distance as in Matnog is the closest point of Luzon to Samar. In the old past, that connection to Samar crossing the San Bernardino Strait was done by wooden motor boats or what is called as lancha in the locality.

These lanchas existed until the early 1980’s. Their fate and phase-out was forced by the arrival of the pioneering Cardinal Shipping RORO in 1979, the Cardinal Ferry 1. With the arrival of other ROROs and especially the government-owned and promoted Maharlika I, the fate of the lanchas were slowly sealed until they were completely gone. By this time the new Matnog Ferry Terminal which was a replacement for the old wooden wharf was already completed.

Maharlika I

The Matnog Ferry Terminal is a RORO port with a back-up area for vehicles waiting to be loaded. At the start when there were few vehicles yet crossing and there were only a few ROROs in San Bernardino Strait that back-up area was sufficient. But over time it became insufficient and so additional back-up areas were built twice. Before that the queue of vehicles sometimes went beyond the gate and even up to the Matnog bus terminal/public market. Worst was when there were trip suspensions and vehicles especially trucks snaked through the main streets of of the small town of Matnog.

The Matnog Ferry Terminal is one of the more successful ports of the government. Actually most ports owned by the government do not have enough revenue to pay for the operational expenses like salaries, security, electricity, transportation and communication and for maintenance. The performance and success of Matnog Ferry Terminal is dictated not by the quality of port management but simply by the growth of the intermodal system. From Luzon there is no other way to Eastern Visayas except via Matnog. The intermodal system began to assert itself in the 1980’s until it became the dominant mode of connection to most of the islands in the country.

The Matnog Ferry Terminal has a total of four corresponding ports in Samar, amazingly. These are the BALWHARTECO port, the Jubasan port of Sta. Clara Shipping Corporation, the Dapdap port of Philharbor Ferries, all in Allen town and the San Isidro Ferry Terminal. The first three are privately-owned ports. The government-owned San Isidro Ferry Terminal lost out early to the privately-owned ports because it has the longest distance at 15 nautical miles while BALWHARTECO port is only 11 nautical miles from Matnog. A shipping company using San Isidro Ferry Terminal will simply consume more fuel and it cannot easily pass on the difference to the vehicles and passengers.

The existence of those many ports in Samar showed the increase over the years of the number of ROROs crossing San Bernardino Strait and also the number of vessel arrivals and departures. Currently, on the average, a dozen ferries and Cargo RORO LCTs serve the routes here with the companies Sta. Clara Shipping Corporation/Penafrancia Shipping Corporation, Montenegro Shipping Lines Incorporated, 168 Shipping Lines, Archipelago Philippine Ferries Corporation, SulitFerry and NN+ATS involved. The last two mentioned are operations of the liner company 2GO.

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In Samar, all those ferries can be docked simultaneously thereby showing enough docking capacity. In Matnog Ferry Terminal only about five ferries can be docked simultaneously especially since the two new RORO ramps there seems not to be in use. When they built that it was by means of bulldozing rocks into the sea to build a back-up area and those rocks seem to be dangerous to the ferries and their propellers and rudders which means a possible wrong design or construction.

When the government built a back-up area near the Matnog terminal/market, I assumed a true expansion of Matnog Ferry Terminal there. A causeway-type wharf could have been developed there and the docking ferries could have been separated there so there would be less mix-up of the departing and arriving vehicles. Causeway-type wharves like what was successfully deployed by the BALWHARTECO and Dapdap ports. This type of wharf is very efficient in using limited wharf space and it is very good in handling ROROs and LCTs.

Until now the Philippine Ports Authority (PPA) insists on using pile-type wharves which is more costly but less efficient. A pile-type wharf is good if freighters and container ships are using the port but freighters do not dock in Matnog but in nearby Bulan port and there are no container ships hereabouts. If there are container vans passing here it is those that are aboard truck-trailers. But many know that if there are “percentages”, the less efficient pile-type wharves will guarantee more pie than can be “shared” by many. And I am not talking of the pie that comes from bakeshops.

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In a causeway-type of wharf the ferries can dock adjacent each other

Matnog Ferry Terminal by its evolution is actually a little bit different now from its sister ports because its wharf has an extention through a short “bridge” like what was done in Cataingan port although this is less obvious in the case of Matnog. The three other Ferry Terminals have no such extensions which is done if the water is shallow and there is enough money like in Ubay port which has an extension that is long and wide enough to land a private plane already (and yet it handles far less traffic than the Ferry Terminals). Almost always the priorities of government in disbursing funds is questionable at best. The budget used in Ubay port would have been more worthwhile if it was used in the shallow Pilar port which has far more traffic and is of much greater importance.

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With lack of RORO ramps it is normal that ferries in Matnog will dock offshore. It is also usual that a ferry will wait a little for a ferry loading to depart before they can dock especially at peak hours. Again, the docking of ferries askew to the port in high tide where there is no RORO ramp still goes on. Matnog Ferry Terminal and the Philippine Ports Authority is really very poor in planning that one will question what kind of data do they input in planning. I even doubt if the idea of a breakwater ever crossed their minds. Matnog is one place where swells are strong especially both in habagat and amihan (it has that rare distinction) or if there are storm signals (and Bicol is so famous for that) or when there is what is called as “gale” warning by the anachronistic weather agency PAGASA (they issue a “gale warning” even if there is no gale; they could have just issued a “strong swell “ warning because it is actually what they are warning about).

In Bicol, Matnog Ferry Terminal has the most number of vessel departures per day if motor bancas are excluded. Matnog’s vessel departures can reach up to 20 daily in peak season with a corresponding equal number in arrivals. In this regard, Matnog Ferry Terminal is even ahead of the likes of Legazpi, Tabaco and Masbate ports and such it is Number 1 in the whole of Bicol. That will just show how dominant is the intermodal system now. And how strategic is the location of Matnog.

A few years ago there was a change in Matnog Ferry Terminal that I was bothered about. Matnog is one port that has a very strong traffic and traffic is what drives income up. But before her term was up Gloria gave the operation of Matnog Ferry Terminal passenger building to Philharbor Ferries. This was also about the same time she wanted to privatize the regional ports of the country with strong traffics like Davao, Gensan and Zamboanga.

Now what is the point of giving the control of a passenger terminal building of a very strong port to a private entity? That port terminal building is actually a cash machine. Imagine about 2,000-3,000 passengers passing there daily in just one direction. Of course Gloria has some debt to the true owner of Philharbor in terms of executive jet services during her term and for providing escape to Garci. Was the deal a payback?

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No covered passenger walkway in Matnog

After years of private operation I have seen no improvement in Matnog Ferry Terminal. From what I know the construction of the two new back-up areas were funded by government. So what was the transfer of control of the passenger terminal building all about? They cannot even build a covered walkway from the passenger terminal to the ferries when BALWHARTECO port was able to do that (and both have long walks to the ferry). Does it mean that BALWHARTECO port cares more about its passengers?

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BALWHARTECO covered walk for passengers

Matnog Ferry Terminal could have been a greater port if properly managed and it should have been properly managed and programmed because it is one of the critical ports of the country. It is actually the strongest of the four Ferry Terminals and by a wide margin at that. Now, if only they will plow some of the profits of the port back into improvements of the port. Or shell out money like what they did to Ubay and Pulupandan ports which severely lacks traffic until now even after spending three-quarters of a billion pesos each. Again one will wonder what kind of data PPA used. Did the “figures” come from whispers of powerful politicians? And did they twist the moustache of NEDA Director-General Neri?

Quo vadis, Matnog Ferry Terminal? You should have been greater than your current state.