Semirara Mining and Power Corp. appealed with the Department of Energy, which imposed a one-month selective coal trading suspension and fines against the integrated mining company.
“We would also like to stress that the DOE Resolution dated Oct. 15, 2019 is not yet final and executory. Our pending motion temporarily defers the implementation of the coal trading suspension, which would allow SMPC to continue serving its coal customers,” SMPC said in a disclosure to the stock exchange.
The department imposed a one-month suspension against SMPC for allegedly violating Section 7.2 of the circular due to coal trading or transaction with Gold Anchorage, an unaccredited coal trader “except deliveries of SMPC-owned power plants and other local power plants with existing coal supply agreements.”
SMPC earlier disclosed that it supplied 4,768.73 metric tons of Semirara coal to Gold Anchorage on May 23 as trial shipment. The buyer issued assurances to SMPC that it had submitted and applied for a coal accreditation certificate with the DOE on April 5.
Under the rules, the DOE will either issue a certificate of accreditation or reject the application.
On shipment date, the buyer was unable to submit the said accreditation as it was still pending with the DOE. SMPC said it then discontinued its supply and any trading with the said buyer.
SMPC said on the DOE suspension order dated Nov. 14, 2019, it was completing the requirements to comply with the conditions. “We intend to reply to the DOE by Friday,” it said.
“Upon receipt of our submitted documents, the DOE shall evaluate our submissions for approval. We estimate that this will take around 15 days. However, this timetable could change depending on the review process of the DOE. We wish to assure the investing public that we are focused on complying with all the directives of the DOE so we can resume operations at the soonest possible time,” it said.
SMPC stopped its coal mining operations after receiving an order from the DOE to suspend all mining activities covered by coal operating contract no. 5 based on the results of the investigation on the mudflow incident in Semirara Island, Antique province last month.
The DOE said the suspension would remain in effect until the company complied with several conditions such as addressing the existing and continuing apparent risk in the Casay Lake area near and adjacent to the operations of the Molave Pit.
It said SMPC should immediately implement a DOE-approved geo-hazard assessment of the Casay Lake area. It should include a specific plan to remove the hazard for evaluation and approval of the DOE.
The agency said SMPC should conduct geo-hazard assessment in all existing and proposed mining areas to identify and determine the risks and appropriate mitigating measures to these geo-hazards such as landslides, mudflows, flooding, storm surge, liquefaction, among others, to be approved by the agency.
It also directed SMPC to conduct a comprehensive review of health and safety program including management leadership, worker participation, hazard identification and assessment, hazard prevention and control, education and training, program evaluation and improvement and coordination and communication, among others.