Visibly tired and teary eyed, Rodolfo Noel Lozada, a key witness in a controversial broadband deal, faced the media at around 2:30 in the morning today. He had been in the custody of the police since Tuesday evening, when he arrived from Hong Kong.

In a handwritten outline, he narrated the chronology of his involvement in the broadband project, and corroborated losing bidder and whistleblower Joey de Venecia III's previous testimonies. He also named and recounted how former election chairman Benjamin Abalos and First Gentleman Mike Arroyo were involved in the project.

Lozada said he was involved in the broadband project in October 2006, when former economic planning secretary and close friend, Romulo Neri, introduced him to Abalos, Chinese officials of ZTE, and de Venecia at the Wack Wack Golf and Country Club.

He said he was tasked by Neri to put together the proposal of Joey de Venecia, which is to have it on a Build-Operate-Transfer mode, with that of Abalos,' which is a loan. Lozada also said the ZTE officials were asking Abalos to package the project "a-la Northrail."

Northrail is another controversial Chinese-funded rail project that was supposed to connect Manila to Clark. It has been put on hold because of allegations of overprice and because it skirted procurement laws. 

CRUCIAL TESTIMONY

Lozada's testimony is crucial because, according to Sen. Panfilo Lacson, it will compel Neri to further explain his actions regarding the broadband deal. For example, Neri earlier testified that Neda did not have the technical capacity to evaluate the broadband project that's why they relied on Formoso, who happens to be the project proponent from the transport and communications department.

"Neri has to explain why he perjured himself. Why did he hide that Lozada was helping him out?"  Lacson told Newsbreak. 

Lozada is not a Neda official nor was officially hired as consultant. In fact, Lozada is with the Philippine Forest Corporation, an environment department subsidiary, which does not engage in information technology projects but with biodiesel crops in upland communities.

But those who have previously worked with Lozada said he and Neri have been close friends for years.

Besides the broadband project, Neri reportedly also consulted him for other projects that passed through Neda, such as the Southrail project.

The Southrail project is a combined project of Korean proponents, who are in charge of the $50 million conveyor system, and the Chinese proponents, who are in charge of the $400 million rail.

Lozada is said to be familiar with Southrail's overprice which runs up to about $70 million. The Southrail project proceeded with little or no fuss, because according to Lozada's friend, to whom he confided, "the overprice was tolerable."

ABANTE TONITE, SOURCE OF FINANCIAL PROJECTION

Neri testified in the Senate last year that he favored de Venecia's BOT arrangement because it did not require the government to assume the financial and technical risks of the project.

De Venecia was supposed to be the proponent of the BOT project, while Abalos and ZTE would be the supplier.

In previous Senate briefings in 2007, Sen. Mar Roxas said infrastructure projects should be evaluated based on pre-determined national development goals, while the choice of suppliers merely follows. Roxas noted that in the botched broadband deal, the choice of supplier, meaning ZTE, was a main factor in pushing the project.

Lozada commented that the broadband project was another example of a "dysfunctional government procurement" process.

In November 2007 meeting that included DOTC Assistant Secretary Lorenzo Formoso III, he said he knew at once that this project was a hoax. He said Formoso was using an article from tabloid, Abante Tonite, as basis for his financial projections. The article was about how much the government was spending for its telecommunications needs.

ABALOS THREATENED MIKE ARROYO?

The broadband project started at $130 million, but Lozada said Abalos insisted on a $130 million overprice. He said it was not acceptable to de Venecia. Under a BOT mode, the project has to churn in profits that have to be substantial enough to cover the overprice. Otherwise, de Venecia will have to assume it as a loss.

Lozada narrated conversations between Abalos and First Fentleman Mike Arroyo during the succeeding meetings.

In a December 2006 meeting, for example, Abalos was pushing for a loan despite President Arroyo's directive to have it as a BOT project. Abalos then called the First Gentleman and threatened that the deal is off if he doesn't get his way. Mike Arroyo reportedly called back that the deal would push through no matter what.

Lozada said Abalos cursed him on the telephone for leaving the project in January 2007. Abalos even threatened to have him killed. Lozada told the press conference that the project was not "worth risking my life for."

Previously, Lozada mentioned in private to a friend how Mike Arroyo thought of him as just a "small fry."

Lozada was not present when Abalos allegedly offered a P200 million bribe to Neri at Wack Wack, nor when Abalos said Mike Arroyo stands to gain about $70 million from the project.

UNANSWERED QUESTIONS

In January 2007, the rift between Abalos and de Venecia became worse, and de Venecia decided to go it alone with his Amsterdam Holdings, Inc., which eventually lost to the Abalos-ZTE tandem. The project eventually became part of the loan package from China.

By the time an executive order from the Office of the President was sent out in February 2007, the project's price tag was already $329 million. It was about $100 million more than the $262 million cost a few months back, which actually already includes the $130 million overprice. It was election time then.

Lozada said there are many unanswered questions about the ZTE broadband project, and that he just wants to "give light to the public's mind," and that he is doing this "without malice to anyone."

SPARE THE FIRST GENTLEMAN

Lozada flew to Hong Kong a few hours before the scheduled Senate hearing on January 30 because he said he did not want to go to the Senate at that time. After he was identified as the witness the weekend before the Senate hearing, he said he was coached by some officials on how to answer questions at the Senate. For example, he was just supposed to say he only discussed the project with the technical people, and that he never dealt with the likes of Abalos and Formosa.

He said that he agreed to leave for Hong Kong because he did not want to lie. He said the people who were coaching him were concerned that he might say something that will expose the First Gentleman

Senators Panfilo Lacson, whom he and his brother approached in November 2007, and Benigno Aquino III, were supposed to fetch him in Hong Kong last February 2 since the Senate blue ribbon committee had issued an arrest warrant for him.

Lacson said Lozada changed his mind at the last minute because Lozada was concerned that his testimony in the Senate might be tainted because the two senators are identified with the opposition. "He said he'd rather fly solo and promised that he will present himself in Senate."

On February 5, Lozada arrived at the Manila international airport and was escorted by people he "does not know," but who informed him that they were sent by Environment Secretary Lito Atienza, his boss. Atienza denies this.

WHAT REALLY HAPPENED?

Lacson said he, Lozada's family, and the Black and White movement, which has been helping Lozada, have mobilized their people to meet him at the airport because Lozada said he wanted to return and testify in the Senate.

Senate security personnel were deployed to the airport to serve his warrant of arrest but reported that he was nowhere to be found after his Cathay Pacific flight landed.

There are conflicting accounts, though. Others say Lozada asked that he be met at the airport by government people because he did not want to attend the Senate hearings.

Lozada said his escorts drove him around Manila and in Laguna, until his escorts received a call to get him back to his family "because my wife was already hysterical in the media."

Yesterday, his wife filed a petition for a writ of habeas corpus to ask the courts to compel whoever was holding Lozada to produce him. Lozada's brother, meantime, filed for a writ of amparo which requires Lozada's "captors" to explain his disappearance.

Newsbreak learned that Lozada was reunited with his wife Tuesday night, at about 9PM. It is unclear why his wife still proceeded to file a petition for the writ of habeas corpus  with the Supreme Court and why the Lozadas did not unite behind one petition.

Lozada said he asked that he be turned over to his priest friends in La Salle Greenhills. Lozada underwent a spiritual retreat last year before he decided to approach Lacson that he was willing to testify at the Senate. Nuns and priests surrounded him during the press conference. They proceeded to the Senate afterwards.

UNDER SENATE CUSTODY

Senator Aquino and Lacson confirmed that Lozada is already in their custody, is resting because he has been up for almost 48 hours straight.

The Senate hearings will resume after the senators decide today if they will let go of the three-day rule, which gives senators time to prepare for the hearing. Aquino said they might vote to disregard this rule because of urgency of the case and the security risk.

Aquino said what Lozada said in the press conference is best dealt with in the Senate because "he will be under oath."

Moreover, in the January 30 Senate hearing that Lozada snubbed, Sen. Rodolfo Biazon asked how the $1.8 billion loan package from China could have accommodated the broadband deal when projects were already lined up for that loan. Biazon asked why the housing project for the military and police, which was in the original list of Chinese loan beneficiaries, was discarded in favor of the broadband deal.

Lozada's testimony, if it will push through, may shed light on that, too.

PHOTO CREDIT: video grab of ABS-CBNnews.com from ANC

SEE RELATED STORIES:

- Senate Key Witness to Corroborate Neri
- Senate Wants ZTE Contract Re-computed
- Computing the Overpriced ZTE
- Senate Wants Absent ZTE Witness Arrested
- Mike Arroyo Promised $70 M in Broadband Deal, Says De Venecia
- GMA Undermined Neda in Getting Broadband Deal Approval
- Neri, JDV III Lied – Abalos
- Abalos Offered Me P200M – Neri
- GMA Played Golf with Businessmen Who Bagged Broadband Deal
- Mike Arroyo pushed for ZTE deal - de Venecia
- Abalos' Golfing Buddy Close to ‘Wiretappers'

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