The Mandaue City Government is poised to resolve a long-standing financial dispute with Asian Energy Corp. by paying a P9.3-million settlement, a move that local officials say will clear the city's debts and address its pressing solid waste crisis.
Council Authorizes Compromise Agreement
The City Council recently passed a resolution authorizing Mayor Thadeo Jovito “Jonkie” Ouano to sign a compromise agreement with the waste management firm. Under the terms, the city will only pay the principal amount owed for waste disposal services dating back to 2016, with all accumulated interest and additional legal fees waived.
Councilor Carlo Fortuna emphasized that the agreement represents significant financial relief for the city. “The most important provision is that the City of Mandaue will only pay P9.3 million. There will be no interest and no other charges,” Fortuna said. He noted that the obligation likely began during the administration of former mayor Jonas Cortes. “If legal interest at 12 percent per annum were applied, the amount would have become very substantial. That’s why this agreement is beneficial.”
The P9.3-million figure was verified and confirmed as the city’s actual outstanding liability by the City Environment and Natural Resources Office (Cenro).
Operational Turnaround
Beyond financial savings, the compromise agreement is expected to streamline Mandaue’s bottlenecked garbage collection. Once signed and formally approved by the court, the city and its individual barangays will be permitted to resume direct dumping at Asian Energy’s landfill facility in Consolacion.
The policy shift will effectively end the city’s reliance on its current emergency setup. Mandaue currently contracts a third-party hauler, Infinite Trading, to transport garbage from a temporary holding area in Barangay Umapad to open disposal sites.
“When we restore direct disposal at Asian Energy, we will have to terminate the services of the third party,” Fortuna said. “The City and the barangays will be able to dump directly at the facility without going through a transporter.”
Budget and Contingencies
Despite the council’s green light, the P9.3-million payout will not happen overnight. Because the settlement was not factored into Mandaue’s annual budget for the current fiscal year, the city government will need to draft and pass a supplemental budget to allocate the funds.
Furthermore, Fortuna clarified that no money will change hands until the compromise agreement receives final court approval and Asian Energy satisfies all necessary documentary requirements mandated by the Commission on Audit.
Looking ahead, local officials acknowledge that the Consolacion facility is not a silver bullet. Because Asian Energy cannot fully accommodate the entirety of Mandaue’s daily waste output, the city is continuing to explore alternative disposal sites — including the Barangay Binaliw Landfill in neighboring Cebu City — to ensure uninterrupted waste management operations.
