DOE: No coal contract extension for Semirara

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February 16, 2026 | 12:00am

MANILA, Philippines — The government has rejected Semirara Mining and Power Corp.’s (SMPC) bid to extend its coal operating contract in Antique for an additional 13 years, setting the stage for an auction later this year.

“Our direction is to have it (contract) auctioned. They said we cannot renew it,” Energy Secretary Sharon Garin said over the weekend, referring to the Department of Justice’s opinion on the extension.

Garin said the auction process is set to take place within the year, ensuring a seamless transition before SMPC’s current contract expires in 2027.

Losing the contract would be a major setback for SMPC, the country’s leading coal producer responsible for around 99 percent of domestic output.

However, this is far from over for the Consunji-led integrated mining firm, which still has the chance to join the bidding war and secure a new contract to continue its decades-long operations on Semirara Island.

“They (SMPC) are qualified,” Garin noted. “Everyone can join the bidding, including the current operator.”

While no other companies have publicly expressed interest in the contract, a source familiar with the matter told The STAR it has drawn the attention of a major energy player.

The company, which has existing investments in coal power generation, wants to take over the contract that grants the exclusive right to explore, develop and operate coal mines on Semirara Island, the source said.

The upcoming auction would not follow the usual pattern of bidders simply offering the highest price to win the contract. Instead, the winner will be chosen based on qualifications.

This, according to Garin, gives SMPC a real fighting chance, thanks to its decades of experience handling what she calls a “complicated engineering project.”

“The advantage is they (SMPC) already know what to do. They have the equipment, hundreds of equipment, and they have experience in Semirara. We want to find the most qualified,” the energy chief noted.

Asked whether foreign companies could participate in the auction, Garin clarified that they can take part only to “a certain degree,” since the contract involves the extraction of the country’s natural resources.

Under its existing contract, SMPC enjoys several incentives, including exemption from all taxes except income tax.

The contract also waives tariff duties and compensating tax on the importation of machinery, equipment and materials required for coal operations, subject to certain conditions.