Gov’t Opens New Chapter For Key Hydro And Coal Assets
- June 19, 2026
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The government is pushing ahead with the long-delayed rehabilitation of the Agus-Pulangi hydropower complex in Mindanao and the re-privatization of the Semirara coal resource – two major energy initiatives that will strengthen power supply assets while maximizing the value of strategic energy resources.
The Department of Energy (DOE) said preparations for the rehabilitation of the 1,000-megawatt (MW) Agus-Pulangi hydropower complex are progressing. DOE Undersecretary Mario Marasigan said the third-party consultant engaged by the Power Sector Assets and Liabilities Management Corp. (PSALM) has completed the terms of reference for the project and is preparing it for the next phase of approvals.
According to Marasigan, the project has already secured board approval and will next be presented to the National Investment Council before being endorsed to the PPP Center.
“We hope to proceed by December, with the project expected to be awarded by then,” he said.
Hydropower Rehabilitation
The Agus-Pulangi complex remains one of the largest government-owned power generation assets in the country. The system consists of seven run-of-river hydropower plants with a combined installed capacity of about 1,000 MW.
Six of the facilities are located along the Agus River, which stretches from Lake Lanao to Iligan Bay across Lanao del Sur and Lanao del Norte, while the seventh plant is situated along the Pulangi River in Bukidnon.
Despite its sizeable capacity, only around 600 MW to 700 MW is currently operational because of aging infrastructure, prompting the government to pursue a comprehensive rehabilitation program.
Marasigan said the project has attracted at least four bids from interested parties. While the DOE has not identified the contenders, PSALM President and Chief Executive Officer Dennis Edward dela Serna earlier disclosed that a consortium was among those expressing interest. In 2025, Lopez-led First Gen Corp. also signaled its intent to participate as part of its efforts to expand its renewable energy portfolio.
PSALM is expected to update the project’s investment requirements through a feasibility study. Earlier estimates placed the rehabilitation cost at around $350 million.
“Operations and maintenance is [will remain a responsibility of] Napocor because it is not a privatization, it’s rehabilitation,” National Power Corp. (NPC) President Jericho Nograles said.
Under the planned arrangement, private sector participation will focus on rehabilitating the facilities and commercializing power generation. The investor is expected to recover its investment through electricity sales, with profits to be shared with PSALM.
Marasigan said rehabilitation work will be undertaken in phases and could be completed between 2028 and 2032 if the contract is awarded on schedule.
Energy Secretary Sharon Garin also expressed confidence that the project would continue regardless of changes in political leadership.
“Once there is an award, they will do the rehabilitation, there’s a contract. There’s a contractual obligation,” Garin said, noting that contractual commitments would safeguard the project beyond the current administration.
Semirara Auction Enters Final Stage
At the same time, the DOE is moving forward with the re-privatization of the Semirara coal resource, with bid submissions expected by July or August following the completion of final consultations with stakeholders.
“It is scheduled within June. Then after 60 days, the bid submissions will be made,” Garin said.
The auction was originally scheduled for April 28 but was postponed after prospective bidders raised concerns that prompted the DOE to revisit certain provisions of the bidding framework.
According to Garin, only limited changes are expected to the terms of reference, mainly to simplify procedures and make the requirements more objective. The agency is also taking into account the fact that the Semirara project is a brownfield operation with existing infrastructure.
The DOE said technical capability would be a major factor in determining bidder eligibility.
“Because that’s really what’s needed. They must know what they are doing,” Garin said, referring to the technical qualifications being assessed by the agency.
The winning bidder will secure a 25-year contract granting exclusive rights to explore, develop and operate the coal resource on Semirara Island in Antique, home to the country’s largest coal-producing area.
Current operator Semirara Mining and Power Corp. (SMPC), the flagship mining company of the Consunji Group, is expected to participate in the competitive bidding process. Its existing contract expires on July 14, 2027. The DOE earlier said SMPC would have to compete for a new contract rather than receive another extension, in line with a legal opinion issued by the Department of Justice.
Semirara remains critical to the country’s coal supply. DOE data showed the Philippines consumed 46.67 million metric tons (MT) of coal in 2024, while domestic production reached only 15.92 million MT. Of that volume, the Semirara coal resource contributed 14.92 million MT, accounting for 93.7 percent of local coal output.
Source:
https://business.inquirer.net/595367/agus-pulangi-rehab-contract-seen-awarded-by-december
