Meralco interested in Semirara’s coal contract

MANILA, Philippines — Manuel V. Pangilinan’s Meralco Group has signaled its interest in taking over operations of the coal mine long run by tycoon Isidro Consunji’s Semirara Mining and Power Corp. (SMPC).

“Better for Meralco or MGEN (Meralco PowerGen Corp.) to take a look at it,” Pangilinan said in an interview when asked about SMPC’s coal operating contract, which is slated for auction later this year.

The contract, set to expire in July 2027, grants SMPC the exclusive right to explore, develop and conduct coal mining operations on Semirara Island in Antique.

While nothing is finalized yet, Pangilinan emphasized that going after the contract is “certainly” on the group’s “radar,” especially for MGEN.

MGEN president and CEO Emmanuel Rubio noted that the potential move could help ensure “fuel security.”

This comes after the government turned down SMPC’s bid to extend its decades-long coal contract by 13 years, clearing the way for a competitive bidding.

The auction will be based on qualifications rather than automatically going to the highest bidder, according to Energy Secretary Sharon Garin.

If MGEN moves forward with the plan and ultimately wins the deal, Pangilinan said it would be a major strategic gain for the company.

“You secure your supply chain locally, so that has been the benefit. You save on freight (costs) at least,” the Meralco chairman and CEO said.

As Meralco’s electricity generation arm, MGEN operates one of the largest portfolios of coal-fired power plants in the Philippines.

The company is also behind the planned 1,200-megawatt (MW) ultra-supercritical coal-fired facility in Atimonan, Quezon.

MGEN aims to nearly double its baseload capacity, targeting 2,519.8 MW by 2030 to help meet the country’s growing energy demand.

Aside from MGEN, other energy players expected to compete for SMPC’s main mining site include Aboitiz Power Corp. and tycoon Ramon Ang’s San Miguel Global Power, an industry source said.

Asked about the prospect, AboitizPower chief corporate services officer Carlos Aboitiz noted that it is “outside the area of business for our company.”

Meanwhile, SMPC remains confident in its “strong competitive edge” to continue operating the mining site, citing its years of experience, established operations, technical expertise and extensive equipment fleet.