The Semirara blocks are currently covered by a contract held by Semirara Mining and Power Corp. (SMPC), operator of the country's largest coal mine and supplier of about 10 percent of the Philippines' coal requirements.
In an advisory issued on Sept. 15, Energy Secretary Sharon Garin said the DOE was terminating the bidding for development and production coal operating contracts (DP COCs) under the Philippine Conventional Energy Contracting Program (PCECP).
“The concerns raised by stakeholders during the pre-submission conferences, developments affecting Semirara Island—one of the offered areas—including continuing water seepage, and certain legal considerations warrant a reassessment of the evaluation criteria applicable to the award of DP COCs (Development and Production Coal Operating Contracts) for the offered areas,” Garin said.
DP COCs are contracts awarded by the DOE to qualified companies to develop coal deposits and commercially extract coal from specified areas.
Garin said terminating the bid round would allow the DOE to review and develop a “fair, equitable, transparent, and comprehensive evaluation framework for the award of COCs involving areas with confirmed or established reserves.”
She said the framework should be consistent with the national interest and ensure appropriate and measurable economic returns and benefits commensurate with the value and characteristics of the areas being offered.
Covered areas
The one-page advisory did not identify the two other areas covered by the terminated bidding.
The DOE, however, announced in February that the 2026 PCECP Pre-Determined Areas Bid Round for Coal covered 10 coal blocks spanning 10,000 hectares on Semirara Island, three blocks totaling 3,000 hectares in Cagayan and five blocks covering 5,000 hectares in Isabela.
The areas were covered by expired or expiring coal operating contracts.
The Semirara blocks are covered by Coal Operating Contract No. 5, held by SMPC, whose 50-year contract is set to expire in July 2027.
The Isabela blocks were previously held by PNOC Exploration Corp. under a contract that expired in December 2022, while contracts covering the Cagayan blocks, previously held by DM Wenceslao and Associates Inc., expired in June 2024.
Bidding rules
Under the original bidding rules, proponents were required to submit five-year development programs detailing their technical and financial capabilities, safety measures, environmental safeguards, community development initiatives and mine rehabilitation plans.
The DOE did not say when a new coal bid round would be opened or when it expected to complete the revised evaluation framework.
During an online news conference on Sept. 15, Garin said the government wanted the next contract for Semirara to provide greater economic benefits to the country while ensuring continued coal production.
Energy security
Garin said the DOE wanted to maximize the country's indigenous energy resources as part of efforts to strengthen energy security, particularly after tensions in the Middle East pushed up global fuel prices.
“Learning from our experience with the Middle East conflict, kailangan talaga (it is needed that) we secure our resources. Kung meron tayong gas, gamitin natin dito. Kung may oil tayo, gamitin natin dito (If we have gas, it should be used in the Philippines. If we have oil, we should use it here). Our renewable energy is only used in our country,” she said.
The same principle should apply to coal, Garin said, stressing the need to make greater use of domestic resources and reduce the country's reliance on imported energy.
“The less we export these fuels, the more energy secure we are,” she said.
The DOE's move comes as global energy prices remain under pressure. The agency said this week that the one-month average price of Dubai crude had reached $99.41 per barrel from Aug. 13 to Sept. 11, exceeding the $80 threshold under Philippine law for the government to consider suspending or reducing fuel excise taxes.
Garin said the DOE was finalizing a department circular that would set the terms and procedures for awarding development and production coal operating contracts before another bidding is conducted. — Ed: Corrie S. Narisma
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