TOKYO/BULACAN, Philippines -- Amid the sodden mangroves of Taliptip, a sleepy fishing village 30 kilometers north of Manila, the San Miguel Corporation is planning to build the world's second-largest airport.
The $15 billion behemoth is the brainchild of Ramon S. Ang, San Miguel's restless president and second-biggest shareholder, who over 17 years has transformed the 130-year-old company from a brewer into a sprawling food, energy and infrastructure conglomerate.
The airport is a hugely ambitious project even for the hard-driving Ang, who started out as a car mechanic and has since built up an almost $3 billion personal fortune.
Although the proposed airport in the province of Bulacan may help fullfil President Rodrigo Duterte's stalled "build, build, build" national infrastructure program, doubters believe it is at best a pipe dream and, at worst, a white elephant that will saddle San Miguel with unmanageable debt.
The conglomerate says the project is a "game changer" that will solve chronic congestion problems at Manila's main Ninoy Aquino International Airport, or NAIA, which is often cited as the world's worst. The 2,500 hectare "aerotropolis" will on completion have capacity to handle 100 million passengers a year, second only to China's massive new Beijing Daxing International Airport.
It will also contribute an estimated 400 billion pesos ($8 billion) to the economy, create over 1 million jobs, and form the centerpiece of a massive real estate development that includes a seaport along with industrial, residential and commercial zones all linked to downtown Manila via a shoreline expressway.
"From the beginning, we were fully aware of the difficulties of a project such as this," Ang told stockholders earlier this year in June. The 65-year-old Chinese Filipino businessman has also boasted, "Nothing of this magnitude has ever been completed."
Ang, whose sustained passion for the Bulacan project is such that he first pitched it to former President Benigno Aquino III over 10 years ago, has a proven track record of creating wealth. Since he began his diversification plan in earnest in 2009, San Miguel's revenues have risen from 143.2 billion pesos to 1.02 trillion last year, while its share price has grown from around 34 pesos to 150 pesos this week.
Ang's continued dreams of glory may well also appeal to San Miguel's board and its top shareholders -- a who's who of the Philippines' rich and powerful.
San Miguel's biggest single shareholder is Inigo U. Zobel, a member of the family that controls another storied conglomerate, Ayala. Eduardo M. Cojuangco, San Miguel's chairman and CEO, is Aquino's uncle. Several former Supreme Court justices and senior government officials also pepper its board and investor register.
But the Bulacan project's unprecedented "magnitude," as Ang called it, is also why it seems so improbable to many.
Its potential problems are legion, even for a savvy business leader named by Bloomberg this year as one the world's 50 most influential.
For one, Manila is already served by three other airports and all of them have plans to expand. NAIA, the capital's main hub, has been tasked by President Duterte himself to double capacity.
That alone apparently stymies a central premise of San Miguel's feasibility studies, which were based on the assumption that the government would shut down NAIA a year after Bulacan's projected opening in 2023. Operations are now due to start in 2026, according to San Miguel's government contract.
In addition, plans are afoot to expand existing Manila airports at Clark and Sangley Point into world-class facilities. These plans have backers too, including Singapore's Changi Group, Ayala, SM Investments -- controlled by the Philippines' richest clan, the Sy family -- and China Communications Construction Co. The government itself is helping finance Clark.
Furthermore, as two of the three proposed airport upgrades aim to accommodate up to 100 million passengers a year, will there be enough business to go around?
Government projections expect 32 million passengers to go unserved by NAIA and Clark Airports in 2023, while the Clark expansion is underway and before Bulacan begins operations.
But even if total Philippine traffic expands at an annual rate of 5.3% over the next two decades, as forecast by Airports Council International, the total passenger count would only reach 262 million by 2040, from 84 million last year.
"You certainly don't want to have a situation where you have, in one city, four airports," said David Bentley, chief airport analyst at the Centre for Asia-Pacific Aviation.
Finance Secretary Carlos "Sonny" Dominguez, a former Philippine Airlines chief executive and childhood friend of Duterte, also has his doubts.
"We want to take a look at what the break-even point is -- what level of passengers will be the break-even point to determine whether it's viable," he has said.
Then there is the question of San Miguel's financial capacity to handle a project of this size, let alone the fact that a company that made its name making beer has no experience of running a major airport.
"The concessionaire conducted their own security assessments and they know the risk," Giovanni Lopez, assistant secretary for procurement at the Department of Transportation, said.
The project's price tag is 735 billion pesos. Although San Miguel foresees financing it with 30% equity and 70% debt, that gross amount is equivalent to the company's current net debt, which in turn is twice its 377 billion peso market capitalization.
As one executive member of the consortium involved in the NAIA expansion said, even its own lenders have questioned San Miguel's ability to see the project through. "If our lenders are asking us those questions about San Miguel, I can't imagine what San Miguel's lenders are saying," the executive told Nikkei.
Still another problem is that the parent and affiliate companies of Philippine Airlines and Cebu Pacific -- two carriers that control nearly half of travel in and out of the country -- are partners in the consortium working to expand Ninoy. This suggests San Miguel would have trouble persuading the nation's two biggest airlines to redirect flights to Bulacan.
"If no airlines want to move, that's not the government's problem," said the Department of Transport's Lopez, who oversaw the approval of the concession agreement granting San Miguel the right to build the airport.
None of these doubts has deterred Ang, who has been described in the local media as a "visionary ... who can see the future beyond the tip of [his] nose and ... puts his money where others can only offer their mouth."
And now, buttressed by the recent $2 billion purchase of concrete maker Holcim Philippines, the country's leading cement manufacturer, Ang has his eye on the prize of a 50-year infrastructure concession that could become the jewel in San Miguel's crown.
In addition to rental income from food, beverage and luxury retail businesses inside the terminal, one source close to San Miguel told Nikkei that the company will double the usual fee for passengers using the terminal to 1,200 pesos for international flights.
If Bulacan reaches full capacity, internal projections show the fees alone would bring San Miguel 120 billion pesos a year in income, helping make the airport profitable by the end of 2032, just six years after opening.
Potential U.S. and Chinese lenders have signed up, according to Ang. Japanese megabank Sumitomo Mitsui Banking Corp. is financial adviser for the project, and South Korea's Incheon International Airport Corp. has potentially agreed to be an operating partner.
All this has helped dispel some of the doubts about the project's overall viability.
Ang "would need to take on substantial debt but he's known for making huge bets," said Luis Limlingan, managing director at Regina Capital. "I think they can deliver, they have in the past."
But, Limlingan added, "passengers are another issue. For them to meet the targets tourism should continue to grow, infrastructure as a whole should catch up, the global economy should avoid recession, and the issue of having three airports within close proximity should be resolved."
It is a long list of "ifs," and CAPA's Bentley has similar reservations.
"If I was being asked to invest in this, I'd need a lot more certainty than San Miguel can offer me at the moment," he said.
Ang, in the end, can always fold. After all, he has made tactical retreats from unprofitable propositions before.
In 2012, his company acquired a 49% stake in Philippine Airlines only to sell the entire interest two years later.
In 2014, Ang then ventured into telecommunications, partnering with Australia's Telstra to take on the Philippines cozy communications duopoly. But, faced with regulatory delays and cost overruns, Ang changed course in 2016, selling out of the telecommunications business altogether.
Similar regulatory obstacles may yet prevent the Bulacan project from getting off the ground.
Although San Miguel has already conducted extensive feasibility studies and begun a land reclamation process, a groundbreaking ceremony was delayed this month pending further government review.
For the 5,000 residents of Taliptip, that delay is both a source of relief and anxiety. If the airport is built, that would end their traditional livelihood as fishermen and invite intense criticism from environmentalists.
But if it does not happen, that would dash the hopes of Taliptip's 300 families for better paying jobs and free schooling.
"We are holding on to what Mr. Ramon Ang has promised," said Renato Bantayo, 61, who lives in Taliptip. "If he doesn't fulfill those promises, that's the time we will probably speak up."
Additional reporting by Cliff Venzon in Bulacan.