Napocor may buy coal from South Africa

National Power Corp. (Napocor) is exploring the possibility of sourcing additional coal supply from South Africa, a top company official said.

"We will most likely tap South Africa for our coal supply. There are ongoing talks with them and we are trying to thresh out concrete terms with them," Napocor president Rogelio Murga said.

Aside from South Africa, Napocor is also into similar negotiations with Australia, Vietnam and Russia.

But Murga pointed out that they will only seal contracts that will be cheaper for the company. "If the price is right, we will get it," he said.

Murga, however, said they have already covered their coal supply requirements from October to December this year.

He said they have firmed up coal supply contracts with China and Indonesia. "We have recently signed a contract with China. The negotiations for coal supply contracts with Indonesia are still ongoing," he added.

Murga said they have finalized coal supply deals with at least eight suppliers from China and have been talking with three suppliers from Indonesia.

The Napocor official said these contracts will consist of 15 panamax shipments at 65 metric tons (MT) each.

Though Napocor has completed its coal requirement for 2004, it still needs to get additional coal supply for next year up to 2006.

Napocor, which is currently importing most of its coal requirement, is also studying the use of blended coal to be able to diversify its coal sources amid a shortage of coal in China, the main source of the company’s coal.

Murga said the state-owned power firm can bring down the rated capacity of its power plants so it can utilize the blended coal.

Aside from the Calaca and Masinloc power plants, Napocor runs the Naga and Batangas coal-fired power plants. Its independent power producers using coal, meanwhile, are Pagbilao and Sual.

The Department of Energy has allowed Napocor to source out its coal requirement from other countries due to an impending power supply crisis in the country.