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PH readies next auction of coal exploration areas

The Energy Department is bidding out new coal exploration and development contracts in the Philippines as part of a plan to secure the country’s energy supply.

The department said it was now accepting applications for coal exploration and development after publishing the terms of the next round of Philippine Conventional Energy Contracting Program. 

“We can now accept application for Coal Operating Contract thru nomination by publication at any given time. The development of indigenous energy resources like coal will contribute to our ultimate goal of energy self-sufficiency,” Energy Department director Melito Obillo said.

The department said a new circular would govern the selection process in the awarding of coal operating contracts and the creation of the review and evaluation committee.

The committee, which will be headed by the Energy Resource Development Bureau, will review or reject the applications based on the compliances to the criteria.

“The selection process in the awarding of COCs to qualified applicants shall be conducted in a transparent, open, competitive and expeditious manner,” it said.

Under the directive, applicants should nominate the areas for interest in accordance with the procedures. The application will be published and other interested can make a counteroffer.

The circular sets the qualification for the evaluation, selection and awarding procedures and the criteria for selecting the highest ranked applicants.

The criteria include legal qualification, work program, technical qualification and financial qualification.

“In case of two or more applicants over the same area, the highest ranked applicant which meets the financial requirements shall be selected,” it said.

Investors under the previous coal contracting round were asked to bid for areas offered by the Energy Department.

Coal remains the most reliable source of baseload power in the Philippines. The fuel accounted for 45 percent of the country’s electricity output in 2015, with natural gas at 23 percent. Geothermal, hydro and other renewable sources contributed a combined 25 percent.

Energy Secretary Alfonso Cusi earlier said the proposed energy mix until 2030 would remain the same even after the Philippines signed the Paris Agreement on climate change last week.

“It won’t (change the mix). Our concurrence is with condition that we won’t sacrifice our energy source to meet the country’s demand,” the energy chief said erlier. 

The Energy Department expects coal-fired power plants to provide inexpensive, reliable and competitively priced electricity that will result in significant savings for households. Sufficient supply generated by coal-fired power plants results in lower electricity rates, which in turn encourages more foreign and local investors.

Topics: Department of Energy , coal exploration , energy supply , Philippine Conventional Energy Contracting Program
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