DOE affirms Semirara fine for coal trading lapse

Published March 25, 2021, 3:15 PM

by Myrna M. Velasco

The Department of Energy (DOE) has affirmed its decision to impose P610,000.00 worth of fines against Semirara Mining and Power Corporation (SMPC) against its coal trading violation that was apprehended two years ago.

The department said SMPC was determined liable for violation of Section 3 of DOE’s Department Circular No. (DC) 2012-05-0006, due the to coal trading or transaction it had engaged in with Gold Anchorage, which has been known as an unaccredited coal trader.

After the fines imposition which was reduced from initially at P1.735 million, the DOE had in turn rendered the removal of the one-month suspension that was earlier meted against the Consunji-led firm, primarily on its coal trader accreditation.

Nevertheless, the energy department warned SMPC that it “should exercise more prudence and care in conducting coal trading-related transactions in order to avoid similar issues and cases in the future.”

The verdict on the imposition of penalties against SMPC was first handed down by the DOE in October 2019, but the company filed a motion for reconsideration on the ruling.

And while sorting out legal remedies on the case, SMPC continued with its coal trading activities – with it noting that it cannot afford to renege on its coal supply commitments to customers.

It was in June 2019 when SMPC was formally flagged with the alleged coal trading violation – relative to the DOE’s mandate on the required accreditation of coal traders and registration of coal end-users before they can engage in business transactions.

The questioned coal trading activity happened on May 23, 2019 when SMPC reportedly supplied 4,768.73 metric tons (MT) of Semirara coal to buyer Gold Anchorage as a trial shipment.

SMPC claimed that the buyer-firm had given its assurances to it “that it has accordingly submitted and applied for a coal accreditation certificate with the DOE.”

The Consunji firm further narrated that when it was already waved down for a policy breach of the DOE Circular, it “discontinued its supply and any trading with the said buyer.”

SMPC was first served with cease and desist order (CDO) by the energy department around June 2019, but the company also sought motion for reconsideration on that decision – and the DOE eventually lifted the initial order stopping its coal trading activities.

That then allowed the company to continually trade and sell to customers that it has been serving and to those whom it has been in contract with.

SMPC is supplying coal as a fuel for the electricity generation of several power plant-end users in the country; and it is also catering to customers overseas via its coal exports. (MMV)

 
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