Salceda pursuing scheme to revive Lucena-Matnog railway project

LEGAZPI CITY — Presidential Legislative Liaison Office (PLLO) Secretary Joey Salceda is pursuing an alternative financing scheme dubbed “Operation Peñafrancia” to revive the long-delayed Philippine National Railways (PNR) South Long Haul project, which aims to restore train services between Lucena City in Quezon and Matnog, Sorsogon. 

In a radio interview with radio station DZGB on Monday (Nov. 2), Salceda, a former Albay governor, said he has been working to attract foreign and local investors through a public-private partnership (PPP) arrangement after previous financing efforts, including negotiations with China, failed to move the project forward.

“The most important thing is to restore train services,” Salceda said, asserting the importance of faster, more affordable and traffic-free travel for regional development.

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He said train fares under this initiative would be subsidized by the government.

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Salceda disclosed that a South African-based businessman of Indian origin, with experience in developing railway systems in Uganda and Tanzania, had been tapped to explore possible financing arrangements, including concessional funding involving the World Bank.

The businessman had already returned to South Africa as discussions and preparations continued, he said.

Salceda said the proposed railway alignment would differ from the existing route in some areas of Albay and Camarines Sur. He cited the proposed alignment through the Peñafrancia area as the inspiration for the initiative’s name.

The broader railway development plan envisions connecting Banlic in Calamba, Laguna, to Legazpi City in Albay, with an extension to Matnog.

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The Lucena-to-Matnog section had undergone feasibility studies and detailed engineering work, with an estimated P17 billion spent on preparatory activities, Salceda said.

However, previous financing arrangements were derailed amid deteriorating relations between the Philippines and China, which had been involved in earlier funding negotiations.

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Salceda said the project had received a P67-billion allocation during the administration of President Benigno Aquino III under the Gradual Transfer and Operations Management Strategy.

The allocation was later realigned, preventing the project from proceeding as planned.

He said the original project cost had reached about P175 billion, but the new financing approach could cover nearly half of the required amount. 

Salceda also cited Julito Sarmiento of Oas, Albay, as among those helping secure private-sector participation in the project.

He said restoring railway services in Bicol remained a priority, although the national government’s immediate railway development focus was on the North-South Commuter Railway, particularly the Clark-to-Calamba section.

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While railway services are also planned between Calamba and Lucena, the extension from Lucena to Bicol remains a separate undertaking under the PNR South Long Haul project.