Gold miner secures power supply deal

Medusa Mining Ltd. has bagged coal resource development contracts that would help ensure the steady supply of power to its Mindanao gold mine.

Medusa Mining also formed an alliance with another Western Australia-based firm, Swan Energy Pty Ltd of Perth, to process the coal produced under these contracts into power.

In a project update posted on its website, Medusa Mining said Swan Energy of Perth agreed to build, finance, own and operate a 30-megawatt coal-fired power station in Agusan. Swan will become the exclusive supplier of power to Medusa’s operations, which are handled by local unit Philsaga.

“This is another strategic step in building a long term future for the company’s long-term operations by planning for power supply security,” company CEO Geoff Davis said.

Based on current usage, which may change in future years, all power in excess of 10 MW will be transmitted to the local grid to help provide electricity for local communities and businesses, Davis said.

Philsaga bagged coal operating contracts (COCs) covering 9,000 hectares through an auction held by the Department of Energy this week.

Philsaga was one of three firms that won a total of seven coal exploration and development sites between them during the first phase of the DOE’s 5th Philippine Energy Contracting Round (PECR5) in Taguig City.

The PECR5 concessions called Area 6 and Area 7 (which Philsaga bid for and won) contain well-defined coal measures immediately to the east of the Co-O gold mining and milling operations in Agusan del Sur province in Mindanao, Davis said.

Obtaining the COCs was the first step toward ensuring a reliable power supply for the long term operations of Philsaga, Davis said. The quality of coal in the areas secured by Philsaga is suitable for coal-fired power stations.