LISTED power and mining firm Coal Asia Holdings Inc. (Cahi) will be supplying coal to the Alcantara-led coal-fired power project in Mindanao.
In a regulatory filing on Wednesday, the company confirmed that it received a purchase order from Sarangani Energy Corp. (SEC) to deliver coal to its stockyard in Maasim, Sarangani province.
It did not provide details though on the amount and volume for the transaction.
Cahi said the deal demonstrates its “ability to mine, develop and ship its coal to power plants in the Mindanao area.” It is noted that the Department of Energy issued a permit for it to sell incidental production of coal from its mining program.
Cahi has two mining facilities in Davao Oriental and Zamboanga—both held through its fully owned unit Titan Mining Energy Corp.
It already disbursed P605.66 million for the ongoing exploration and development of the coal mines using the proceeds of its initial public offering two years ago. Commercial production of the Davao Oriental mine began in October 2013, with “proved and probable” reserves of 7 million metric tons (MMT) as per the attained prefeasibility study.
The Zamboanga-Sibugay project, on the other hand, is set to become fully operational this year. Approximately, Cahi’s annual production capacity of high-grade coal is less than 100,000 metric tons.
As the owner of TMEC, it holds the second largest coal reserves and resources in the country, with the identified 120 MMT of “potential deposit” for both mining facilities. A subsidiary of Alsons Consolidated Resources Inc., SEC designs, constructs, assembles, rehabilitates, expands, operates, and maintains power-generating plants and related facilities for the generation of electricity, including facilities to purchase, manufacture, develop or process fuel for the generation of such electricity.
Also, it sells electricity to any person or entity through electricity markets, by trading, or by contract, as well as administers, conserves and manages the electricity generated by power-generating plants. SEC’s 210-megawatt (MW) coal-power plant in Maasim, Sarangani, is targeted to go on commercial stream by September 2015, which is expected to yield 105 MW of capacity for the first phase.
The coal plant project is intended to be part of a long-term solution to the current power shortage in Mindanao.