DOE sets ‘competitive challenge’ for coal contracts in Mindanao

The Department of Energy (DOE) has scheduled a 60-day "competitive challenge" for coal operating contracts (COCs) originally applied for by Vintage-21 Coal Mining Corporation covering coal blocks in Lingig, Surigao Del Norte and Boston, Davao Oriental in Mindanao.

In an ‘invitation for challenge’ issued by the energy department, it stipulated that opening of tenders to be submitted by interested investors will be by September 9 this year.

“Interested applicants may challenge the application of Vintage-21 Coal Mining Corporation by submitting their application over the same area in accordance with and subject to the following prescribed timeline and procedures,” the DOE said.

Interested applicants are required to submit three complete sets of legal, technical and financial documents for evaluation by the Review and Evaluation Committee (REC).

They are likewise apprised that their submissions on the prescribed criteria shall be the basis of evaluation and assessment if they would be able to beat the offer of the original proponent.

“Each application shall cover only one pre-defined area of interest with corresponding number of coal blocks as nominated and published,” the tender notice stated.

The energy department further specified that “only exploration word program in the application for COC (coal operating contract) that conforms to the work program documentation, shall be accepted.”

For the challengers, the department had imposed a non-refundable fee of ₱200,000 per area, to be paid by the applicant “upon submission of the application and its supporting documents,” and payment can be done either by cash or manager’s/company cheque payable to the DOE.

The exploration and development of indigenous coal resources had been among the investment areas being pushed by the DOE, so the country can increase its output on this resource extraction because this is not only beneficial for domestic power applications, but also for other industries such as in cement, steel and other facets of manufacturing.

Despite the country’s targeted shift in the power mix that will rebalance the portfolio of thermal power and renewable energy by 2035 and 2040, the energy department indicated that extraction of the country’s coal resources would still be a gainful venture, primarily in meeting the long-term fuel needs of key industries.