Republic of the PhilippinesDEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS

PRE-QUALIFICATION, BIDS AND AWARDS COMMITTEE

General Bid Bulletin No. 04-2015

Projects: DAVAO SASA PORT MODERNIZATION PPP PROJECT

TO ALL PROSPECTIVE BIDDERS:

Attached herewith as Annex <lA"is the Powerpoint Presentation delivered during the Pre-qualification Conference held last 22 May 2015.

Please be reminded that all queries and requests must be sent in writing by personal deliveryand e-mail, to the Chairman of the Pre-qualification Bids and Awards Committee (PBAC). Alladdresses mentioned in Section 3.4(a) of the Instructions to Prospective Bidders (ITPB) shouldalso be provided copies of the same by personal delivery, email or fax.

For your guidance and information.

Issued this 26th day of May 2015.

~~ATTY,J S PPERPETUO M. LOTILLAUnders cretary for Legal Affairsand Chairman, Pre-qualification, Bids and Awards CommitteeDavao Sasa Port Modernization =»

THE COLUMBIA TOWER \.If'IV\!J If- ~O:2.BRGY.WACK-WACK, ORTIGAS AVENUE Acxx:r'J tv!1555 MANDALUYONG CITY, PHILIPPINES ~

TELEFAX: (632) 723-4925TRUNKLlNE: 790-8300DOTC ACTION CENTER HOTLlNE: 7890

Philippines Davao Sasa Port

Public Private Partnership Project

Prequalification Conference May 22 2015

Agenda

• Project Overview

• ITPB: Prequalification Requirements

• Illustrative Project Structure

• Timeline

2

Proposed Development Scope

• Dedicated container terminal constructed in phases

• Capacity up to 1.2M TEUs

• Container STS cranes and RTG or equivalent CH yard equipment with optimized

coverage of available land area

• 750m linear quay wall allowing for up to -14m draft

• Optimized layout for maximum container storage including Full, Empty and Reefer

Containers

• Extension of terminal gate complex to total 8 lanes (4 in, 4 out) with separate light

vehicle and emergency services gate

• Terminal Operations Building with accommodation for other government offices (One

Stop Shop concept) and dedicated Customs Inspection area

• Installation of a Terminal Operating System

• Dedicated maintenance and repair workshop

3

Development Opportunity: Why Sasa?

• Davao Bay total container traffic expected to increase fivefold to 3.1m TEUs by 2040

• Sasa Port’s ability to capture up to 1/3 of this traffic due to competitive advantages

such as:

• Strategic location in the growing Davao City (import driver)

• Rapid growth in population, tourism and business hub

• Stable peace and order

• Vicinity to banana plantations (export driver)

• Customs office currently located in Sasa

• Balanced imports and exports allow vessels to capture full cargo potential with a

single call at Davao Sasa

• Good geographic location along main shipping routes may attract main line

container traffic– provided terminal extension that allows for accommodation of

larger vessels

4

Davao Bay Traffic Forecast

5

2040, 3.1 M

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

201

3

201

4

201

5

201

6

201

7

201

8

201

9

202

0

202

1

202

2

202

3

202

4

202

5

202

6

202

7

202

8

202

9

203

0

203

1

203

2

203

3

203

4

203

5

203

6

203

7

203

8

203

9

204

0

Davao Bay Container Potential, TEU

Container Traffic Forecast – Davao Bay

6

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

201

3

201

4

201

5

201

6

201

7

201

8

201

9

202

0

202

1

202

2

202

3

202

4

202

5

202

6

202

7

202

8

202

9

203

0

203

1

203

2

203

3

203

4

203

5

203

6

203

7

203

8

203

9

204

0

TEU

Davao Sasa Container Terminal Private Terminals

DICT Container Terminal Hijo Container Terminal

Sasa: 1.27 m

Hijo: 1.04 m

DICT: 0.68 m

Private Terminals: 0.25 m

7

“New Quay” “Old Quay”

Sasa Existing Port Facilities

Conceptual Port Layout (Complete Phase)

• Phased development with continued operations during construction

• Key data for layout of proposed berth and yard

Linear quay, usable length ~750 meters, deepen draft to -14m, ability to accommodate

up to 9000 TEU vessels

Use of STS cranes; RTG blocks- 7 wide + truck lane; Lift height 1 over 5 (High Cube),

~ 2700 ground slots

8

Informal Settlers

Area (not used for

port development

in this concept

layout )

Conceptual Port Layout – Construction Phase 1a

• Operational: Original “New Quay area”

• Construction: Phase 1a (250m quay)

9

Informal Settlers

Area (not used for

port development

in this concept

layout)

Conceptual Port Layout – Construction Phase 1b

• Operational: Phase 1a area and part of “New Quay area”

• Construction: Phase 1b (next 250m quay for a total of 500m)

10

Informal Settlers

Area (not used for

port development

in this concept

layout)

Conceptual Port Layout – Construction Phase 2

• Operational: Phase 1a & 1b areas

• Construction: next 250m quay (total 750m)

11

Informal Settlers

Area (not used for

port development

in this concept

layout)

Conceptual Technical Solution

12

Sasa Port Current Proposed Total

Quay Length (m) 1093m (non-linear) 750m (linear)

Draft (m) -11m -14m

Container Yard size 4.15 ha 9.7 ha

CY Ground slots 864 2700

Ground Slots / ha 209 282

Design Traffic (2040) 550K TEU 1.2M TEU

Max Design Vessel Size 500 TEU 9000 TEU

Equipment 5 STS Cranes, 14 RTG

12

Prequalification Overview

• Invitation to Prequalify published 10 April 2015

• Invitation Documents – available for purchase at Php300,000

Instructions to Prospective Bidders (ITPB)

Preliminary Information Memorandum (PIM)

• ITPB provides the rules, procedures and requirements for prospective investors to

pre-qualify to bid for the Project, including the Qualification Requirements to

pre-qualify as bidder

• Submission of Qualification Documents for Prequalification will only be accepted

from prospective bidder who have paid the Php300,000

ITPB - Legal Qualification Requirements

• SEC- or foreign equivalent-registered partnership, corporation; or consortium whose

members are similarly registered and incorporated

• Prospective bidder and its Affiliates (used to meet any of the PQ requirements) have

no Unsatisfactory Performance within last 5 years:

Failure to satisfactorily perform an obligation as evidenced by a judicial

pronouncement or arbitration award

Final or undisputed termination or suspension due to breach of obligations

Final or undisputed material violation of laws and/or regulations

Current inclusion in blacklist of the Philippine gov’t or major financial institution

Involvement in any Corrupt, Fraudulent, Coercive, Undesirable, or Restrictive

Practice or having Conflicts of Interest

• Commits to meet ownership lock-up period requirement, proposed at 10 years from

signing of the Concession Agreement

• Initial Public Offerings to be allowed in the future

ITPB - Technical Qualification Requirements –

Development Experience

• Development Experience:

Experience and track record over the last 10 years in the design/ supply/

construction/ installation/ management/ successful commissioning of port

infrastructure project of similar size and characteristics (modern container

terminal port):

1. One or more projects: aggregate amount of at least USD150,000,000; and

2. at least one single brownfield (or redevelopment or conversion) project of at

least USD75,000,000 (=required works for each Phase)

Experience can be met by prospective bidder/consortium member, an Affiliate or

a contractor

Allow up to 3 contractors to be nominated but with exclusivity to a Bidder -

substitution allowed (equal qualification)

Must meet valid licensing and ISO certification requirements

Must submit a certification that it has no record of Unsatisfactory Performance.

ITPB - Technical Qualification Requirements –

O&M Experience

• O&M Experience:

Experience and track record in operating a port of similar function (international

and domestic modern container terminal port) and size:

1. Operating for 3 consecutive years at least 2 international container

terminals, with a combined throughput of at least 500,000 TEU, one of which

should have at least an annual throughput of 300,000 TEU

2. The container terminals must be located in more than 1 country

3. Operation must comply with ISO 9001 (Quality) and ISPS (International Ship

and Port Facility Security Code)

Experience can be met by the Prospective Bidder/consortium member, an

Affiliate or O&M contractor

Only 1 nominee allowed per prospective bidder

A Prospective Bidder will be disqualified if the entity qualified by the PBAC

withdraws between Bid Submission Date and CA signing

Commits to own at least 20% equity stake in the Facility Operator, which must

be retained throughout the Lock-up Period

Required to show proof of operating acceptable existing Terminal Operating

System

• For both the Development and O&M Experience:

Must submit a sworn statement to participate in, and have capacity to

undertake, Project requirements

ITPB - Financial Qualification Requirements

• Equity test

Minimum net worth of PhP3 billion

• Debt

Testimonial letter from qualified bank (s) that the Prospective Bidder is:

banking with them and is in good financial standing, and

qualified to obtain credit of at least PhP7 billion, or has a cash balance of no less

than PhP7billion, which may be reduced by the excess of the Prospective Bidder’s

net worth (amount in excess of PhP 3 billion).

• Can be met by the Prospective Bidder, consortium Lead Member (i.e., member holding

largest share of at least 34% equity interest), or an Affiliate of the Prospective Bidder or

the Lead Member

• Can nominate only 1 entity to meet the experience

• Must submit a certification of Absence of Unsatisfactory Performance Record

Bid Parameter

•Highest Concession Fee

Illustrative Project Structure/Entities to be Pre-qualified

19

Special

Purpose

Company

DOTC & PPA Banks

Facility Operator* EPC Contractor

Concession Agreement Finance Docs

Construction Contract O&M Agreement

Co. A Co. B Co. C Co. D

Lead O&M Sponsor

O&M Contractor

or ≥ 20% equity

≥ 33%

Contractor A

Contractor B

Contractor C

* Must meet Constitutional requirement for P/U

Transaction Timeline

20

Step Expected Completion

Publication of Invitation to Pre-Qualify and release of Pre-

Qualification documents April 2015

Pre-Qualification Conference May 2015

Pre-Qualification Submission and Evaluation June 2015

Release of Invitation to Bid and Draft Concession Agreement July 2015

Bid Conference August 2015

Bid Submission & Award December 2015

Signing of Concession Agreement Q1 2016

Start of Phase 1 Construction Q1 2017

Start of Operation of Phase 1a (=18 months construction) Q2 2018

THANK YOU

21