Business World Online
Posted on April 01, 2012 09:11:49 PM
COAL PRODUCER Semirara Mining Corp. expects profits to grow by as much as 15% this year despite an expected flattening of output, with its two power plants seen to add to the bottom line.
“We expect to see 10% to 15% growth after the two power plants [under refurbishment] starts running. It should produce more power this year than last year,” Semirara Chief Executive Isidro A. Consunji said in an interview.
He added work on the plants were supposed to be completed in May but that there were more things that had to be fixed.
Semirara posted a P6-billion net income in 2011 driven by its coal and power operations.
Its coal segment contributed P4.1 billion to its bottom line while its power unit added P1.9 billion to its profits.
Semirara runs the 600-megawatt (MW) Calaca coal-fired power plant in Batangas.
It runs the plant through its subsidiary SEM-Calaca Power Corp.
The Calaca coal-fired power plant consists of two 300-MW units and uses a combination of coal from Semirara and imported coal.
Unit 1 of the power plant has been running at a de-rated capacity of 220 MW and is expected to reach 270 MW-300 MW after its rehabilitation.
Semirara, through parent company DMCI Holdings, Inc., bought the Calaca power plant from the government in 2009 for $361.7 million.
Mr. Consunji said the company is expecting coal production to be flat this year.
“[Production will be] flat. It will be seven million tons this year and it was seven million tons last year,” said Mr. Consunji.
He added the company sold more coal locally last year “since local demand is improving.”
The company expects its capital expenditures to reach $450 million in 2012. The capex, however, will mainly be used for the planned expansion of the Calaca power plant.
“Capex will be for the expansion. It will be $450 million. Other than that it will be pretty standard,” said Mr. Consunji.
The firm is planning to expand the Calaca power plant by another 300 MW.
The 300-MW power plant will be located adjacent to the current 600-MW Calaca coal-fired thermal power plant. The expansion of the Batangas coal-fired power plant is part of Semirara’s long-term goal to increase its power generation capacity to 1,200 MW.
The plant is expected to provide power to Manila Electric Co. (Meralco), but Mr. Consunji said the firm has not yet spoken to the power distributor regarding a contract for the expansion’s output.
The firm signed a power supply contract with distribution utility Meralco in December last year.
Under the agreement, the Calaca plant will provide 210-MW of power to Meralco and will be increased to 420 MW “upon the commercial operation of the plant’s Unit 1.” -- Emilia Narni J. David
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