Positive audit result averted power outages– Semirara Mining

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MASSIVE power outages and the consequent economic dislocation these would have caused were averted because of the positive results of the government audit on Semirara Mining and Power Corp. (SMPC), a company official said over the weekend.

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“We always protect the environment while extracting coal. The audit reports confirm that commitment. We are responsible miners and keep upgrading our systems and processes when new technologies come to the market,” said Engineer Ruben Lozada, resident manager of the Molave coal mine in Semirara Island.

The Department of Energy (DOE) and the Environmental Management Bureau (EMB) of the Department of Environment and Natural Resources (DENR) issued separate audits last week saying that SMPC complies with all government regulations on the protection of the environment.

The company accounts for 97 percent of local coal production, which is used for power generation and by some cement companies.

Coal is a constant daily source of electricity and is among the cheapest feedstock compared to bunker and gas, among others. Coal accounts for 45 percent of total power generated last year, SMPC said. Without coal, electricity would be more expensive, the company said.

Based on August data, electricity from coal plants owned by SMPC’s sister company was sold to power distributor Manila Electric Company (Meralco) for only P2.517 per kilowatt-hour, the lowest rate. All others ranged from above P3 per kWh, all the way to more than P8 per kWh, Lozada said.

“The closure of the Semirara coal mine would have been disastrous for the economy and the public, and possibly could create unnecessary political risks for the administration,” Lozada said.

“Without coal, there would be outages, business disruption and retrenchment, and, in the case of affected cement companies, perhaps a supply lack that could affect infrastructure and housing,” he added.

Environment Secretary Regina Paz Lopez said last week that the report issued by EMB Region 6 regional director Jonathan Bulos remained unofficial. Bulos reportedly released copies of an audit report to Semirara without the approval or knowledge of the audit team and Lopez.

In a disclosure to the Philippine Stock Exchange last week, Semirara said that it received copies of the audit report from the EMB, noting that the DENR has found its Molave expansion project “technically sound” and “compliant with environmental laws.”

The mine site is in Antique Province, around 510 kilometers southwest of Manila.

Lopez implied that releasing the audit results to Semirara Mining was premature as the DENR was scheduled to release the audit results of all mining operations on Tuesday.

“That RD is in hot water. What he did was totally inappropriate,” Lopez said.

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