Converge ICT says Bifrost and SEA-H2X subsea cable projects could be delayed

Philippine broadband service provider Converge ICT Solutions reportedly said the completion of its two international submarine cable networks is likely to be delayed to the first quarter of next year.

The company is part of the consortia behind the Bifrost Cable System and the South-East Asia Hainan-Hong Kong Express Cable System (SEA-H2X) projects respectively.

Local media reported that Converge has allotted the majority of its 2024 capital expenditure of 17 billion to 19 billion Philippine pesos (US$299.77 million to $335.04 million) for the two international subsea cable systems that were initially set to be completed this year.

Jesus Romero, Converge chief operations officer, hinted that adverse weather conditions have contributed to the delay.

"There are certain things you can't control like weather conditions. But the laying is going on," he told reporters last week.

Difficulty in securing the necessary permits

But the main culprit of the missed project timelines appeared to be the protracted time spent in getting the necessary permits to build the subsea cables.

"Imagine each country, you need to get some permits. It depends on the area, especially when you are passing Indonesian waters. It is not easy to get access to Indonesia," Converge co-founder and CEO Dennis Uy told the same gathering of reporters.

Bifrost, which is designed to carry capacity up to 15 Tbits/s, will span 15,000 kilometers connecting the Philippines to Singapore, Indonesia, Guam and the west coast of North America.

The SEA-H2X project, on the other hand, will carry up to 160 Tbits/s over a distance of 5,000 kilometers that covers the Philippines, Hong Kong, China, Thailand, East Malaysia and Singapore.

Converge became a member of the Bifrost consortium in 2021, after signing a deal to acquire an Indefeasible Right of Use (IRU) from Keppel Midgard Holdings (KMH) for one fiber pair on the system, with Converge agreeing to co-develop the Bifrost branch that will land in Davao, which is located in the southern Philippine island of Mindanao. The Bifrost cable system is supplied by Alcatel Submarine Networks.

Meanwhile, the broadband service provider teamed up with China Mobile, China Unicom and PP Telecom for the SEA-H2X consortium, with HMN Technologies tapped to build the system.