The Philippine Ports Authority (PPA) will urge the Development Bank of the Philippines (DBP) to release the P500 million share of First Metro Investment Corp. (FMIC) in the bond float, after the latter backed off with the agreement.

PPA general manager Oscar M. Sevilla said they have already exerted their effort to compel the FMIC to release the amount but to no avail.

He earlier warned that the modernization plans of PPA will be in peril if it will not release the P500 million, which is part of the second tranche of the debt paper.

"We already received P1.5 billion out of the P2 billion bond float. FMIC has backtracked and so we will ask DBP to release the P500 million," he said.

The DBP board has released the P500 million share of the float and the other P500 million must come from the underwriter FMIC. PPA should have availed the second tranche of the P2 billion bonds early this year, but the availability period already lapsed on February 11.

FMIC has earlier expressed concern over the Supreme Court decision ordering PPA to pay the Batangas port resident about P11 billion to P14 billion (including interest and penalties), rising speculations that it would not be able to pay its debts.

Sevilla said the SC en banc hearing was finished and they will submit on April 23 the recommendation on summation of agreement.

"We already told the SC of our position on the P5, 500 per sq.m. or P55-million per hectare that the residents were asking from us. The Justices were alarmed and they also noted that it seems that the PPA was victimized by syndicates," he said.

PPA maintained that the SC decision is not yet final and that it still hopes that the highest court will merit its plea.

The PPA will use the amount for the modernization of the 6 priority ports namely the wharf at Cagayan de Oro, Sasa Wharf port expansion, Iloilo Container Port Complex, wharf in Ozamiz Oriental and phase II of the wharf expansion at the Zamboanga, and the General Santos City port expansion.

PPA and underwriters First Metro and DBP made an agreement last year on the P2 billion-debt paper, which carries a 7 percent interest rate and has a maturity of 7 years.

Both released their respective share of the first tranche of P500 million each in July last year.

Last August 24, a division of the Supreme Court sided with the landowners’ and upheld the earlier decision the Batangas regional trial court ruling that set the compensation for landowners at P5, 500 per sqm for the contested 1,298,340 square meters of land.