Semirara mining operations suspended

MANILA, Philippines — The Department of Energy (DOE) has suspended the mining activities of Semirara Mining and Power Corp. (SMPC) after a mudslide incident in its facility in Antique last month.

In a disclosure to the Philippine Stock Exchange yesterday, SMPC said it was directed by the DOE to suspend “any and all mining activities under Coal Operating Contract No. 5.”

The order was issued in relation to a mudflow incident in Semirara Island, Antique Province last Oct. 2.

The DOE has laid down conditions SMPC needs to comply to have the suspension order lifted.

SMPC needs to address the existing and continuing apparent risk in the Casay Lake area near and adjacent to the operations of the Molave Pit.

The company is required to conduct geohazard assessment of the Casay Lake area and submit a specific plan to remove the hazard, which will be evaluated and approved by the DOE for implementation.

Meanwhile, the DOE also directed SMPC to also ensure safety for other areas under the development and production stage.

It was ordered to conduct geohazard assessment in all existing and proposed mining areas to identify and determine the risks and appropriate mitigating measures to these geohazards such as landslides, mudflows, flooding, storm surge, liquefaction, among others.

SMPC was also directed to conduct a comprehensive review of health and safety program.

It was also required to reorganize its safety department to address its deficiencies and provide appropriate competencies to implement a DOE-approved health and safety program and allocate sufficient budget for the implementation of the said program.

SMPC said it has been in close coordination and full cooperation with the DOE on all its legal and regulatory compliance, particularly the safety aspect of its operations, since the incident took place.

“Our company is completing these requirements for submission to DOE the soonest and is confident that the conditions for resuming operations can be speedily met. Lastly, SMPC is committed to providing all the needed health and safety trainings and amendments to further enhance the safety and welfare of our employees,” it said.

While the suspension of mining activities will dent the company’s coal production, SMPC said it has already met its output target for the year.

“The DOE orders of suspension will result to opportunity loss in production per day from 40,000-45,000 MT. The financial impact, however, shall depend on the prevailing price of coal,” SMPC said.

To date, the company’s total production is already at 14.5 million metric tons (MT), which is 12 percent higher than total 2018 production of 12.9 million MT.

Meanwhile, coal shipment already reached 14.6 million MT, a 26 percent rise from 11.5 million MT total shipment last year.

This is not the first time a landslide incident happened in SMPC’s mine site. In 2013, a landslide in Semirara’s Panian Pit also injured and killed some mining workers.

Another incident occurred in 2015, which took the lives of nine miners. The said incident led to the suspension of the mining firm’s operations for 64 days while the DOE conducted its investigation.

Semirara is the only vertically integrated energy company in the Philippines that mines its own fuel source – coal.

As the country’s largest coal miner, Semirara has two operating mines in the Semirara Island in Antique, which are the Molave and Narra Pits, where about 70 percent of its production is for local demand while the rest is for export.