POSTSCRIPT / March 16, 2006 / Thursday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

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Deep-wells of giant firms destroy Manila aquifers?

REYES CHALLENGED: Over 35 business and commercial establishments in Metro Manila have been reported to be illegally extracting huge volumes of water from deep-wells. This allegedly contributes to the drying up of the water table and the sinking of the land in many areas.

Apprised of this problem, Environment and Natural Resources Secretary Angelo Reyes recently ordered Executive Director Ramon Alikpala of the National Water Resources Board to order these firms to stop using their deep-wells.

But many big-time commercial users routinely ignore the NWRB’s cease and desist orders. Maybe they think they are untouchable.

Let us see if Reyes’s knees and military bearing can hold up when he tries enforcing on the big drawers of groundwater our laws protecting the environment.

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CAPITAL SINKING: As reported in Tuesday’s Postscript, the massive extraction of groundwater in the populous national capital has resulted in formerly productive deep-wells going dry or contaminated.

The overworked aquifers (layers of permeable rock, sand, or gravel through which groundwater flows) have dried up or have had their water turn brackish with the seepage of sea water. The water-bearing structures are unable to recover fast enough.

Another alarming signal is that Metro Manila has been sinking 10 times faster than during the period before the 1960s. This has been observed in Guiguinto, Bocaue-Marilao, Meycauayan-North Caloocan, Navotas-Caloocan-West Quezon City, Makati-Mandaluyong-Pasig-Pateros, Paranaque-Pasay, Las Pinas-Muntinlupa, Dasmarinas-Cavite, and some areas in the Marikina Valley fault zone.

The phenomenon has been traced partly to the drying up of aquifers and the crumbling of layers in the vicinity of the emptied space.

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BIG USERS: With many commercial users of giant deep-wells refusing to recognize the problem and help find solutions, the government may have to crack down on them before the situation worsens.

A study by the NWRB has estimated that only less than half of some 3,000 companies in Metro Manila needing big volumes of water operate legal deep-wells. The rest may be extracting groundwater without the necessary permits.

Some of the big users on the DENR/NWRB’s watch list have been identified in government reports as the Manila Electric Co. (Meralco), St. Luke’s Medical Center, Corinthian Gardens, Manila Peninsula Hotel, Citibank Makati and Quezon City, The Landmark, Araneta Center in Cubao, and the Greenhills Shopping Center.

We expect them to issue statements or explanations for their inclusion on the list.

Records show that last year, the NWRB shut down the deep-well of The Landmark in Ayala Center for allegedly not stopping its extraction of groundwater despite several cease and desist orders of the board.

Last December, the NWRB was also reported to have issued similar orders to Meralco and the Greenhills Shopping Center. No final action has come out.

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BACKUP ONLY: In meetings and statements, Reyes has served notice that he would not allow further damage to the environment and that violators of conservation laws, including those persisting on using illegal deep-wells, will have to pay for it.

He said that even if big violators now apply for permits for their deep-wells, their requests would be turned down because excessive extraction has depleted the groundwater in Metro Manila to critical levels.

The policy is to use aquifers, tapped through wells, only as a backup source. At least 97 percent of the water requirement for the metropolis is supplied by the Angat dam in Norzagaray, Bulacan, while the rest is sourced from wells.

The DENR/NWRB allows deep-wells only where households and establishments have no access to water from Manila Water and Maynilad Water, the two concessionaires that have taken over the franchise area of the Manila Waterworks and Sewerage System servicing over 12 million people.

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CREEPING SALINITY: Since we usually move or show concern only when disaster strikes, most people are not even aware of the magnitude of the problem of aquifers in Metro Manila going dry or salty.

Or even if we know, we tend not to act if the problem does not affect us directly yet. Will we see hurried corrective action only when the problem has reached an irreversible point?

One aspect of the situation report on Metro Manila’s aquifers is that salt water from the bay has started to seep into the drying-up water tables in the western parts of the metropolis.

Reyes has said: “Metro Manila aquifers are now on course to being depleted to meet the present water demand of the metropolis. (It) will become extremely difficult to flush the intruding saline water back to the sea. It will take many years of sufficient quantities of freshwater to force back to the sea the saline water that (has) intruded (into) the aquifers.”

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LAKE AFFECTED: A ground-level illustration of the problem of creeping salinity is the increased presence of sea water at the east end of the Pasig River where it meets Laguna de Bay, the country’s biggest freshwater body of water. The west end of the river is connected to Manila Bay.

With tidal flows, it is to be expected that that neck of the lake may show traces of brackishwater. But it has been observed that salinity has deepened and crept farther into other parts of the lake.

This will affect the lake’s ecosystem and the livelihood of communities depending on it. Over the long term, salinity may also add a technical and financial burden because the lake is one of the potential sources of potable water for Manila in the future.

Of course there are other problems in the lake, such as its irrational exploitation, siltation and the continued pollution from household and industrial wastes.

In the Middle East, some Arab governments have tapped the sea, using desalination to remove the salt and produce potable water. In the Philippines, we are going in the opposite direction: allowing the sea to overcome our sources of fresh water.

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THINKING BIG: The Philippines is not really such a big economy, with its banking system actually a small player on the world, even regional, stage.

Trying to survive in our fragmented banking system is a clutter of 40 commercial and expanded commercial domestic and foreign banks, 85 thrift banks, and 752 rural and development banks servicing a small market.

Without meaning to belittle our bankers or to give clients/depositors a feeling of insecurity or inferiority complex, listen to this:

* The total assets of the top five banks in the Philippines are less than the assets of the Bank of Thailand, the largest in that neighboring country.

* The total assets of all the 21 local commercial and expanded commercial banks in 2004 ran to $69.8 billion. This is smaller than the total assets of OCBC Bank, the smallest of the three major banks of Singapore which has $73.5 billion.

* Our top three banks account for less than 20 percent of the market, compared with more than 55 percent in Malaysia

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SIZE MATTERS: If you think this is a pitch for bank mergers or consolidations, it is.

The Central Bank itself, from the time of CB Gov. Gregorio Licaros Sr., has been advocating moves in this direction. The immediate past governor, Rafael Buenaventura, also encouraged consolidations. Same thing with incumbent Gov. Amando Tetangco Jr.

Along that line, Banco de Oro Universal Bank (BDO), the bank of the SM Group, has offered to merge with the Equitable PCI Bank with the BDO as the surviving bank.

The SM Group owns the largest block of shares in BDO at 34+ percent, with the Social Security System holding 29 percent.

The merger is being opposed by the Government Service Insurance System which holds a 12-percent stake in EPCIB, and the Romualdez Group which has a 7+-percent (sequestered) share in the same bank.

They contend that that offer for a swap in shares, of 1.6 BDO shares for every EPCIB share, was too small. But BDO said that was just a starting offer leading to negotiations.

Whatever formula is eventually adopted, a BDO-EPCIB merger would make BDO (assuming it would be the surviving bank) the second largest bank in the country, behind Metrobank.

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(First published in the Philippine STAR of March 16, 2006)

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