Semirara Mining & Power Corp. (SMPC) assured investors Thursday that its operations remain “business as usual” following a Department of Energy (DOE) announcement that it will not extend the company’s coal operating contract beyond July 14, 2027.
SMPC said in a disclosure to the Philippine Stock Exchange it has not yet received a formal response from the DOE regarding a final decision on its request for a term adjustment under Coal Operating Contract (COC) No. 5. The company previously requested a 13-year extension as the contract nears its expiration.
“The company continues to operate under its existing COC, which remains valid until July 14, 2027. Mining, shipments, and power generation activities are ongoing and are not affected,” the company said.
The DOE sought a legal opinion from the Department of Justice (DOJ) on contract extensions beyond a 50-year period.
Energy Secretary Sharon Garin said the DOJ issued an opinion saying the DOE cannot extend the contract and must instead put it up for bidding before it expires. Garin added that the DOE intends to conduct the bidding process this year.
SMPC management said the company is implementing prudent capital management to preserve financial flexibility.
It noted there is no immediate impact on its financial condition or operations beyond the mine plan already submitted to the DOE.
“The company intends to fulfill the remainder of its current COC while preparing the appropriate mine plan and documentation should the DOE proceed with a formal bidding process,” SMPC said, adding that it awaits the issuance of relevant notices and guidelines.
Earlier this week, the company expressed confidence despite the looming auction and confirmed its intent to participate in the process.
“Management believes that SMPC’s decades of experience in managing complex engineering projects, coupled with its established operations, technical expertise, and extensive equipment fleet… provide a strong competitive advantage,” the company said.
The company oversees operations that contribute significantly to the local power supply, often involving investments valued in the billions of pesos.
While specific recent profit figures were not in the disclosure, SMPC typically handles transactions exceeding P10 billion annually.
