Meralco may take a look at Semirara coal bid — Pangilinan

MANILA ELECTRIC CO. (Meralco) is open to participating in the government bidding for the coal operating contract on Semirara Island, which has been held by Semirara Mining and Power Corp. (SMPC), its chairman said.

“Better if Meralco or MGEN (Meralco PowerGen Corp.) take a look at it,” Meralco Chairman Manuel V. Pangilinan told reporters on Monday.

The government plans to open bidding for the contract this year.

MGEN is the power generation arm of Meralco and operates a diverse portfolio of power generation assets, including thermal and renewable energy technologies.

Mr. Pangilinan said the company is capable of operating a mine-mouth project, a power station located adjacent to a coal mine that allows the direct transport of fuel from the mine to the plant through a conveyor belt.

He said this setup could help localize the fuel supply chain and reduce freight costs.

SMPC has held the coal operating contract for nearly 50 years, allowing it to explore, develop, and mine coal on Semirara Island.

The company obtained the contract in 1977, granting it mining rights for 35 years, which were later extended by 15 years.

With the contract set to expire in 2027, the company has sought approval from the Department of Energy (DoE) to renew the contract for an additional 13 years.

Energy Secretary Sharon S. Garin said the contract should be put out to bidding rather than renewed, following a legal opinion from the Department of Justice.

SMPC said on Monday that it intends to participate in the bidding if the DoE formally initiates an auction, citing its long operational experience on Semirara Island.

“SMPC’s decades of experience in managing complex engineering projects, coupled with its established operations, technical expertise, and extensive equipment fleet developed through its long-standing operations in Semirara Island, provide a strong competitive advantage, which we have communicated to the DoE,” it said.

SMPC, the power generation and coal-mining unit of the Consunji group, is the Philippines’ largest coal producer and the only power company in the country that owns and mines its own fuel source.

Meralco’s controlling shareholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera