Semirara allots P500M for capex this year

Semirara Corp., the coal unit of the Consunji family’s DMCI Holdings Inc., is setting aside P500 million for its capital expenditures this year and for investments in power generation and nickel mining.

In an earlier disclosure to securities regulators, DMCI said it plans to acquire P100 million worth of shares of affiliate DMCI Mining Corp., a contractor for a mining claim in Sta. Cruz town in Zambales under a mineral production sharing agreement in the name of CRAU Mineral Resources Corp.

Following the equity infusion, Semirara will own 50 percent of DMCI Mining while the other 50 percent will be owned by parent firm DMCI Holdings.

DMCI Mining’s capitalization will be increased to P500 million from P80 million, according to its earlier filing.

Semirara will also subscribe to P125 million in equity in DMCI Power Corp. whose authorized capital stock will be raised from P80 million to P1 billion.

DMCI Power has two major power generation projects: the 100-megawatt coal fired power generation plant in Concepcion, Iloilo and the 15-megawatt coal fired power plant in Masbate.

Semirara is venturing into nickel and gold mining and power to boost its cash flow amid declining coal revenues.

In the nine months ending Sept. 2007, Semirara reported a net income of P565 million, slightly lower than the previous level, due to lower prices of coal.

Semirara is the country’s top coal producer, accounting for 92 percent of the country’s total output. It supports 23 percent of domestic consumption.