MG Mining & Energy Corporation said that it is expanding its current market to cover Cagayan de Oro, Zamboanga and Davao as local demand for coal continues to grow.

Mr Michael Morales VP of MGMEC said that the company expects sales in Mindanao to reach 20,000 tonnes a month because of this expansion. He added that MGMEC has existing yearly contracts to sell at least 5,000 tonnes a month in General Santos City, where it has a 95% market share.

Mr Morales said that their main market consists of canneries and other food manufacturers with large energy requirements to operate boilers. Many of these firms have converted their boilers to use coal instead of bunker due to high fuel costs. He added that "The canneries and food manufacturing industry in Mindanao remains a niche market for us."

He said that "They spend an initial PHP 25 million to PHP 30 million to buy new coal fired boilers but are able to recoup this investment in less than a year from savings due to the huge difference between the costs of coal and bunker."

Mr Morales said that this new nontraditional market for coal is providing MGMEC with a strong base for growth on top of its traditional customers in the power generation and cement manufacturing industries.

(Sourced from www.businessmirror.com.ph)