The largest coal miner in the Philippines, Semirara Mining Corp., has indicated its intent to spend US$ 400 million on boosting capacity at the Calaca coal-fired power plant.
Semirara forecast that two-thirds of profit will come from power generation in three years.
The company may now sign a syndicated loan for 70% of the cost of the expansion as early as Q3, CEO of Semirara, Isidro Consunji said in an interview.
The Philippines saw power demand rise by 50% in the 10 years leading to 2012, more than three times the 16% increase in generation capacity over the same period, according to government data. Fresh supply of power is therefore being added to the Southeast Asian nation to meet the rising demand.
“It’s more logical to grow the power business,” Consunji said in an interview. “It’s simpler to run and is more profitable. We do what’s easy for us and we forget what’s not.”
The expansion will increase the Calaca coal-fired power plant’s capacity by 350 MW to 1200 MW, Consunji said. It bought the plant from the government in 2009 for US$ 362 million.
Power accounted for 54 percent of Semirara’s revenue in 2013, compared with six years ago when almost all sales came from its coal business, according to data compiled by Bloomberg.
As power demand increases, by 2015 Semirara may stop exporting the coal it produces from its mine in Antique province in central Philippines, Consunji said. In 2013, the company exported almost half of its 7.63 million t output.
“For every one peso you make in mining, for the same amount of coal, you make two pesos in power,” Consunji said. “Eventually, only a third of income will come from mining, and two thirds from power three years down the road.”
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/power/25062014/philippine_coal_miner_will_invest_in_power_plant_1016/