San Miguel to explore more coal mines using latest technologies

MANILA, Philippines - San Miguel Corp. (SMC), the largest food and beverage conglomerate in Southeast Asia, said it intends to explore more coal mines using the latest mining technologies.

SMC president Ramon Ang told reporters recently that they would still push through with their various mining projects in Mindanao, despite the clamor by some local government units (LGUs) to stop open pit mining.

SMC Energy Corp., the power generation arm of the San Miguel Group, has been exploring the possibility of putting up a number of mine mouth coal plants in support of the government’s energy security policy.

SMC, along with the government, believes that coal remains the cheapest transition fuel amidst the country’s effort to promote renewable energy sources.

Ang said the critics of open mine pit mining should not worry about these projects as there are a lot of state-of-the-art technologies that could be applied for the protection of the environment.

“We’re not affected. If they do not want those in the surface, we can do some underground mining. There are technologies now that can be used,” Ang said.

Earlier, South Cotobato passed an environmental code that banned open pit mining in the province. Open pit mining uses a method which allows extraction of minerals beneath the surface of the earth by removing the top layers of land. After mining, it leaves holes or pits on the mine site.

SMC Energy is proposing to build coal power projects in Mindanao with an estimated cost of $2 billion.

The power firm said it was able to finalize the purchase of a number of coal concessions at the Daguma coal reserves located in Sultan Kudarat and South Cotabato to support its proposed coal power projects.

The Department of Energy (DOE) is expecting more than 1,800 megawatts (MW) of power to be generated from clean coal power plants in the near term.

The DOE said the country requires a total capacity addition of 4,100 MW. For Luzon grid, alone, it will need a cumulative capacity of 3,000 MW.

The Visayas grid demands 500 MW while the Mindanao grid will require 600 MW additional capacity.

Since the government is prohibited to enter into new obligations, it has encouraged the private sector to build up 1,020 MW additional capacities for the period 2009 to 2011.

Of these, 900 MW will come from coal-fired sources. 

A 600-MW Bataan coal-fired facility will be constructed in Luzon by GN Power and will go on stream by 2011.

Another 200 MW will be built by Korea Electric Power Co. (Kepco)/SPC Power Corp. in Cebu and will be completed in 2011; and a 100-MW coal-fired power plant project by DMCI Power Corp. in Iloilo is expected to be available in 2011.

The DOE said the remaining capacity requirement offer vast opportunities in the generation business for private sector investment.

At present, the energy department said project development led by the private sector in different stages indicate a potential capacity addition of 4,543 MW.

Indicative power projects in Luzon, the DOE said, include the 50-MW clean fluidized bed (CFB) coal power plant of Asia Pacific Energy Corp. (APEC) in Pampanga which is expected to be completed in 2010; and the 300-MW coal-fired power plant facility in Subic to be undertaken by Redondo Peninsula Energy Inc. which has a scheduled completion date of 2012.

In the Visayas, the indicative coal power projects include the 164-MW GBPC coal fired plant (Panay Power Corp.) in Iloilo which will be constructed by the Global Business Power Corp. of the Metrobank Group. This is expected to come on stream by 2011.

For Mindanao, the DOE is expecting two committed projects namely: the 200-MW CFB coal fired power plant in Southern Mindanao to be built by Conal Holdings Corp. and to be completed in 2011.

Another coal-fired facility that is expected to rise in Mindanao is the 200-MW Sultan Kudarat to be constructed by MG Mining and Energy Corp. and will go on commercial operations by 2012.