SMPC: Semirara coal auction rules unfair

MANILA, Philippines — Semirara Mining and Power Corp. (SMPC) has pushed back against what it calls “unfair” rules governing the auction of the country’s largest coal mine, with the bidding process now facing another delay.

The new rules require SMPC, the current operator of the Semirara mine in Antique, to disclose its complete asset portfolio and surrender them to the government should it participate in the auction.

“We are the only company covered by this rule. This is unfair and basically bars us from bidding,” the Consunji Group’s integrated energy company said in a statement yesterday.

SMPC said the requirement to surrender its assets as a condition to bid conflicts with Presidential Decree 972, which recognizes the company’s ownership of the assets and gives it one year after the expiration of its operating contract to remove them.

SMPC’s current contract is set to expire in July 2027.

Beyond asset disclosure, the company also questioned the absence of pre-qualification requirements, noting that prospective bidders would not need prior mining experience to participate.

Under the proposed framework for awarding the contract, the financial offer will be the “sole ranking factor” among qualified bidders. This means the bidder with the deepest pocket could secure the contract, regardless of whether it knows how to mine.

“Semirara is no ordinary mine. We are mining in the sea, deeper than the height of the highest building in Makati. We have to pump out the equivalent of 12 Olympic-size swimming pools or the Pasig River’s torrent every hour just to get to the coal,” SMPC said.

SMPC stressed that awarding the contract to another operator could lead to zero coal production and zero royalty payment to the government, the opposite of what the auction hopes to achieve.

Under its existing contract, the company is required to remit 30 percent of its net proceeds as royalties to the government.

From 2021 to the first half of 2026, SMPC paid P43.4 billion in government share and taxes, latest company data showed.

Energy Secretary Sharon Garin earlier told The STAR that the Semirara coal auction would be relaunched this month after the previous bidding round was scrapped in September.

The auction, however, has hit another snag, raising the prospect of further delays.

On the sidelines of the 44th ASEAN Ministers on Energy Meeting, Garin said the Semirara coal contract could be put up for bidding only in “November or early December.”

“Semirara is not substantial enough to affect our supply, coal is coming from Indonesia,” the energy chief said when asked how the delays in the coal auction would affect the country’s supply.

The Semirara mine, the largest of its kind in the country, currently accounts for around 90 percent of domestic coal production.