Semirara plans 1,200-MW plant expansion

The Consunji-led Semirara Mining Corp. is planning to put up a 1,200-megawatt coal-fired power plant complex in Batangas, which will triple the capacity of its existing 600-MW Calaca coal facility at the site.

Semirara Mining chief finance officer Nestor Dadivas explained that the company, through its subsidiary SEM-Calaca Power Corp., would begin the construction this year with the first phase of two units that could generate a combined 300 MW.

Dadivas disclosed that SEM-Calaca would choose within the next two weeks its engineering, procurement, supply and construction (EPC) contractor for the first 300 MW. There were four or five companies that submitted proposals to the Consunji firm.

The company, he added, also planned to source all the parts of its power units from China. Once the contract has been signed, it may take 32 to 36 months until the first 300 MW facility can be commissioned. The target is to complete the first phase by 2014.

Initially, it was reported that Semirara, through SEM-Calaca, only wanted to double the capacity of the Calaca coal plant to 1,200 MW. But Dadivas said the site could actually accommodate up to 1,800 MW, an expansion that could be done over the long term. The first 600 MW is targeted to be completed within five years’ time.

It has yet to decide if the construction of the succeeding facilities (900 MW)—should all plans push through—would still be implemented by SEM-Calaca or by another recently formed subsidiary.

“We’re still studying whether it should be part of SEM-Calaca. We’re studying the incentive side, operation side, management side, and whatever options that will be available for us in the future,” Dadivas said.

According to Dadivas, Semirara preferred to initially pursue the project on its own and just take in partners in the succeeding phases.

“It is known that several groups wanted to join us in this project. We feel we can move faster with the implementation if we go on with it ourselves at the start. After all this is just phase 1, there’s going to be a phase 2. Over the long term, [we’re adding a total of] 1,200 MW,” he said.

“We’re going by phases because we don’t want our project to be in big chunks. It will be difficult to market [in one shot something as big as] 600 MW. It’s better to market the small capacities of 150 MW or 300 MW,” Dadivas added.

The proposed facilities would solely use coal from the Semirara coal mines, he said.

“The advantage of the [proposed] plants is that because of the clean coal technology, these can use lower grade coal,” Dadivas pointed out.

The planned coal-fired plants can use coal with a lower grade of 2,900 to 3,000 kilocalories (kcal), whereas the regular grade coal will be 5,200 kcal. This means that the stripping costs of the mine will decline since what was then considered as the mine’s waste would now be used to fuel a facility.

The lower grade coal would also command a lower price than the regular grade coal and only Semirara would be able to enjoy this added benefit, Dadivas said.

“So our fuel cost, hopefully, will be an advantage. Before, our advantage in the fuel cost was only the freight component. This time, it’s really the cost of the coal because we can use the lower grade coal of Semirara,” Dadivas said.