Who holds the permits in MIWD’s bulk water project?

By: Gerome Dalipe

THE three bulk water suppliers of Metro Iloilo Water District (MIWD) have no permits in their own names, the Commission on Audit (COA) discovered.

But MIWD explained that the setup is part of its bulk water supply agreement with the suppliers.

In their 2018 annual report, state auditors said the permits submitted by three bulk water suppliers were not in their names.

“As the bulk water suppliers have no water rights in their own names and the use of the water permit of actual permitees has no evidence of authorized transfer or lease under the code, their legal capacity to supply bulk water to the district is cast with doubt,” read the COA report.

Section 2 of the National Water Resources Board (NWRB), states that a permit or authority shall be secured from the MIWD Board such as the transfer or lease of water right, as evidenced by a water permit.

The MIWD has three bulk water suppliers – Metro Iloilo Bulk Water Supply Corp., Flo Water Resources (Iloilo) Inc., and the Iloilo Prime Water Ventures Corp.

But the auditors discovered the permit of Primewater Infrastructure Inc., Solerex Water Tech, Inc., and Marro Holdings Corp. is being used by Flo Water and Iloilo Prime Water to supply bulk water to MIWD.

Likewise, the three bulk water suppliers of MIWD failed to present transfer or lease of water right required by the National Water Resources Board (NWRB).

“Under the Code no person, including government instrumentalities or government-owned or controlled corporations shall appropriate water without a water right,” read the COA report.



Replying to the report, the MIWD said Metro Iloilo Bulk Water Supply Corp (MBWSC) utilizes the water permit pursuant to the joint venture (JV) in the bulk water supply contract.

MIWD OIC General Manager Amarylis J.C. Castro said “the Metro Iloilo Bulk Water Supply Corporation (MIB) is using the water rights of MIWD because it is part of the obligation of MIWD under the JV and lease agreements.”

The agreements allow the use of water rights and ensure the validity and renewal of the same rights in the name of MIWD, Castro added.

However, as discussed with COA, MIWD is making representation on the matter with NWRB to clarify whether a change of name in the permit is needed for the temporary use of the existing water rights/permits or the provision of the JVA and lease agreement will suffice.

The JVA underwent strict review by the Office of the Government Corporate Counsel, (OGCC) prior to signing, Castro said.

FloWater Resources (Iloilo), Inc. (FloWater) and Iloilo Prime Ventures Corporation (Iloilo Prime) are both joint venture companies of Primewater Infrastructure Inc, (Primewater), Solerex Water Tech, Inc. (Solerex) and Marro Holdings Corporation, (Marro). They supply bulk water to MIWD based on the provisions of the Philippine Procurement Act for supply of goods.

On this matter, Engr. Brian Ken M. Altubar, Area Engineer of Iloilo Prime, replied in a letter dated September 23, 2019 that Primewater, Solerex and Marro are the permittees of Permit. No. 022873, not the JV companies that were formed thereafter.

Copies of the agreement for Injection Point areas No.2 & 3 were submitted also to NWRB. Altubar added that these were evaluated by NWRB when it issued the permit.

Rogelio Florete Jr. of Flowater also said in his reply letter to MIWD dated September 4, 2019 that Flowater is “a joint venture corporation created by parties that agreed to secure all the permits and licenses required by the bulk water supply project in favor of Flowater.”

Clearly, it is beyond doubt that Flo Water has the legal capacity to supply water to MIWD, Castro noted.

“MIWD taking into consideration the recommendation of COA and informed the bulk water suppliers of AOM No. 2019-007 and submitted the abovementioned reply letters to COA,” Castro added.

But since water is vital to the government, the auditors said it is necessary for the state, through the NWRB, to intervene actively in improving the management of water resources as all waters of the Philippines, pursuant to the provisions of the Constitution.

Likewise, the auditors recommended that the legal capacity of bulk water suppliers is clearly established to ensure that they are qualified under the code.

The bulk water suppliers are also required to submit to MIWD the necessary transfer or lease of water right from the actual permitees, as evidenced by a water permit.