The numbers of cancelled contracts for prospective renewable energy (RE) developments have been raised to 70, and the Department of Energy (DOE) enforces heavy-handed directive for them to comply with requirements until first week of May or get ready to be tossed into the chopping block.
“Around 60 to 70 (of RE service contract holders) have been sent show cause order,” Energy Undersecretary Jay Layug said, adding that they can still reverse the cancellation during the prescribed ‘curing period’ of 60 days stretching from February to May.
Of the 70 contracts deemed cancelled, the bulk are for prospective hydro developments, according to the energy official. “There have been too many contracts awarded for hydro, so most of those cancelled are hydros,” he stressed.
The initial number of contracts divulged to have been cancelled by the energy department had been at 50 in February. It climbed to 70 after more thorough review of all the 227 RE deals.
Pending the prescribed appeal period, energy officials have been constrained from divulging at this point which contracts have been lurking at the danger of being thrown into the trash bin.
Once the ‘curing process’ lapses and if the prospective developers would still be delinquent on their commitments, the DOE can already proceed with the final cancellation of the contracts.
Of the total figure, Layug noted that there have been voluntary cancellations because developers found it unviable to develop RE resource in specific areas covering their service contracts.
“Of the 60-70 contracts, we have around 10 which have submitted for voluntary cancellations,” he reiterated.
Apart from RE, the energy department is also moving forward with the cancellation of contracts for upstream developments in oil and gas; as well as in the coal sector.
For oil and gas, Layug affirmed that the department already moved for the final cancellation of four service contracts due to the operators’ non-compliance on requirements. It has been reported that these are mostly held by Burgundy Global Exploration Corporation.
Additionally, the department is working on the termination of three to four contracts in coal exploration in Luzon and Mindanao areas.
