THE Department of Energy (DOE) plans to bid out Semirara Mining and Power Corp.’s coal operating contract this year ahead of its 2027 expiration following a Department of Justice (DOJ) opinion advising against a renewal, Energy Secretary Sharon Garin said late Friday.
“Our direction is to have the contract auctioned to the highest bidder, as they (the DOJ) said we cannot renew it,” she told reporters on Friday.
“We have a schedule, and it should be bid out this year so preparations can be made by the investors that are moving in and also those that will be moving out,” she added.
“Unfortunately, I can’t remember the exact date but again, it should be bid out this year.”
Semirara Mining was granted the exclusive right to explore, develop and mine coal on Semirara Island in 1977 for a period of 35 years, or until 2012. The contract was later extended by the DOE for another 15 years.
Garin said the listed mining firm had requested another 13-year extension of the contract, but after three-way talks, the DOJ said an auction was what was required under the Constitution.
“We have mentioned and discussed this with both Semirara Mining and Power Corp. and with DOJ,” she said.
“Overall, we will respect the opinion of DOJ on this and they said there cannot be a renewal now, just bidding, because that’s what the Constitution says. The company wanted [a] renewal but unfortunately, we cannot do that.”
Any qualified local firm, including Semirara, can participate in the bidding, she added.
Semirara, Garin said, could have an advantage as it “already knows what to do, as they have the equipment and have the most experience.”
As for foreign investors, “there is a limitation in the Constitution due to this development being related to [the] extraction of natural resources, so there might be limits to that.
Semirara representatives were not immediately available for comment.
The company’s shares on Friday rose P0.95, or 2.95 percent, closing at P33.20 apiece.
