THE Department of Transportation (DoTr) said it has been approved for a P3.6-billion facility by the Land Bank of the Philippines (LANDBANK) to help settle its obligations with Light Rail Manila Corp. (LRMC), the operator of Light Rail Transit Line 1 (LRT-1).
“We hope that as we settle our obligation with the private concessionaire, we will see more improvements in their services, including structural upgrades, digitalization, and the reliability of the rail line,” Acting Transportation Secretary Giovanni Z. Lopez said in a statement on Tuesday.
Mr. Lopez said the credit line agreement with LANDBANK will enable the DoTr to fulfill its financial obligations with the LRMC to ensure continued services.
In February, the Light Rail Transit Authority (LRTA) said it is processing a loan with LANDBANK to settle the government’s P4-billion obligation to the LRMC.
The government, through the LRTA, has already paid P926 million to LRMC, the LRTA has said.
Of the more than P900 million already paid, about P499 million went to structural rehabilitation, P409 million to light rail vehicle (LRV) shortfall payments, and about P22 million for right-of-way acquisition settlements.
The LRTA has said that of the P4 billion claimed by LRMC, about P3 billion was the result of delays in the approval of fare adjustments.
Metro Pacific Investments Corp. (MPIC) has announced plans to divest from LRMC due to mounting losses, which were mainly attributed to the government’s delayed payments.
LRMC assumed operations and maintenance of LRT-1 in September 2015 under a P65 billion, 32-year concession agreement with the LRTA and DoTr.
Under the agreement, the operator may seek a fare adjustment every two years. In April 2025, the DoTr approved LRMC’s petition for fare adjustments, though the new fare matrix remains below the company’s requested rates, resulting in a deficit of P2.17 billion.
MPIC holds a 35.8% stake in LRMC through its unit, Metro Pacific Light Rail Corp., while Sumitomo Corp. owns 19.2% and Macquarie Investments Holdings (Philippines) Pte. Ltd.10%. LRMC is a joint venture company of MPIC, AC Infrastructure Holdings Corp. (a unit of Ayala Corp.), Sumitomo, and Macquarie Investments Holdings. — Ashley Erika O. Jose
