Semirara expects higher net profit

Semirara Mining and Power Corp., which posted a 24-percent increase in net profit last year, expects double-digit growth again this year with the opening of new power stations and improvements in efficiency for coal mining and coal-fired power plant operations.

Semirara president Victor A. Consunji said the rehabilitation of existing power plants could generate additional electricity and boost company income this year. Commercial operations are finally in sight for the 300-MW coal-fired power plant of subsidiary Southwest Luzon Power Generation Corp. (SLPGC) and this could add P2 billion in income coming from the P8.5 billion generated in 2015, he said.

“We are hoping that if Unit 3 and 4 (of SLPGC) will run as it is running operational now, I think there’s a big possibility that we will have an upward trend. But how many percent, we don’t know because that depends on so many factors,” Consunji said. He also noted that the coal mining business of Semirara is affected by falling international coal prices while volatile oil prices add to business costs.

Revenues from the 300-MW SLPGC coal-fired power plant should surge this year from just about P100 million last year, Consunji said.

“That will pull the full year contribution compared to last year,” said CFO Junalina S. Tabor. “Our ballpark estimate is for every 300 MW to contribute P2 billion in profit that will add to income.”

Consunji said the impact of the new power station’s operations should be significant enough to help the company generate double-digit growth coming from P8.5 billion in 2015 and assuming the company could control the costs.

In 2015, SLPGC failed to achieve commercial operation status due to a series of technical issues. The power station with two units of 150 MW each was commissioned in early 2015 and synchronized to the grid on July 7 for one unit and on Aug. 16 for the second unit. However, the finetuning and debugging activities are still in progress and some equipment needed upgrading and replacement for reliability.

“We are aiming to close all these equipment and parts issues before the end of the first half of 2016 to achieve final turnover and acceptance of the two units within the year,” Consunji said.