DOE chief rejects claims coal mine auction rules are unfair
The country’s energy chief refuted claims of “unfair” coal mine bidding, as Semirara Mining and Power Corp. (SMPC) had alleged that the rules were designed to exclude it from the auction.
“If that’s the implication, [but] it’s the same rules for everyone. If you qualified based on our rules, it’s not because we’re just making rules particularly for one company. It’s for everyone,” Department of Energy (DOE) Secretary Sharon Garin told reporters on the sidelines of the World Nuclear Supply Chain in Taguig City.
Garin said the Consunji-led group should just wait for the release of the terms of reference for the planned auction, which may be issued this month.
The official said investors wanting to vie for the Semirara coal block would have enough time, at least a month, to prepare their documents.
Change of rules
“We’re giving the chances to everyone. It’s just … the change of rules,” Garin said, referring to rules covering brownfield assets or existing projects.
She added that the changes were made to “maximize” the resources, including demanding operators to allot the majority of the coal production for domestic use.
SMPC described some of the provisions as “unfair,” claiming further that those would effectively bar the group from bidding.
“To require us to surrender ownership of our assets as a condition to bid is against Presidential Decree [No.] 972, a special law on coal mining, which clearly says that such assets are ours and we can remove them within one year from the expiration of our operating contract,” the company said earlier this month.
The current operator of Semirara coal mine also questioned the government’s decision to prioritize the highest bidder over those experienced ones.
If the government leans on an inexperienced company, SMPC warned that the country may see “zero” coal production by July of next year. SMPC’s contract will lapse in the same period.
It would also translate to “zero royalty payment” to the government, defeating the objective of the bidding to raise fresh funds, it added.
Garin said the DOE is ready to relaunch the coal bidding within the year.
