2013 Special: Aggressive campaign for new petrol stations, oil storage depots

THE YEAR 2013 for the local oil industry was marked by constant pump price increases during the first half of the year and subsequent price decreases. The increases were mainly brought about by the turmoil in the Middle East, which fueled speculations of disruption in oil supply from the Middle East that pushed global oil prices higher.

The Philippines imports more than 90 percent of its oil and fuel products, and because the local market is very small in relation to the global oil trade, anything from foreign exchange movements to political developments and global price speculation play a significant role on local prices.

With heightened demand for fuel brought about by rising sale of vehicles, oil companies operating in the country announced expansion plans, particularly the opening of more gasoline stations. Filipino-owned Seaoil Philippines is expanding its network of gasoline stations by putting up 700 to 800 stations over the next three years. It plans to spend about P1.2 billion every year for the project, according to Seaoil president Francis Glenn Yu. By the end of the year, the company is aiming to have 370 stations, most of which are franchised.

Petron announced it is also undergoing massive expansion and modification. According to Petron chairman and CEO Ramon Ang, the oil company would be able to produce Euro IV products by end of 2014.

The Euro IV standard is a globally accepted European emission standard for vehicles. The Euro IV standards require fuel to have significantly low amounts of sulfur and benzene. The upgrade of its refinery in Limay, Bataan would allow Petron to produce 180,000 barrels of oil per day from an average of 100,000 barrels today. Petron targets to build 5,000 new service stations in three to four years and complete relocation out from Pandacan oil depot to Navotas; Rosario, Cavite; and Limay, Bataan by 2016. Under its network expansion program, the company recently built its 1,000th station located in Guiuan, Samar, bringing their total number of stations in the country to 2,100.

Newcomer Unioil Petroleum Philippines, Inc. completed six new stations in Luzon, making the total number of the company’s gasoline stations to 33. Of these stations, 21 are in Metro Manila and the rest are in Cavite, Laguna, Nueva Ecija, and Pampanga. The remaining 14 stations planned for this year are under various stages of development. Unioil earmarked about P400 million to build 20 retail stations every year until 2015 to reach the company’s target of additional 60 stations.

TWA Inc., the oil company behind the Flying V brand, will put up another biodiesel facility in the Visayas with 30-million liters capacity. The company has an existing 30-million liter biodiesel plant in Sasa, Davao City, which caters to the biodiesel needs not only of Flying V but also of other small oil players.

The Visayas biodiesel facility is estimated to cost around P40 million, or almost the cost of the facility in Davao.

Dubai-based Kampac Oil Middle East plans to invest in a multi-billion dollar oil depot project near the boundary of Laguna and Quezon provinces. Kampac Oil plans to distribute and sell oil in Southeast Asia with the Philippines as its distribution hub in Asia.

PTT Philippines Corp. (PTTPC) expanded operations in South Luzon this year. The company is hoping to end 2013 with 70 stations nationwide, 20 of which are currently under construction and are set to open this year in South Luzon. Currently, the company has a total of 50 stations nationwide. Most of these stations are in North Luzon and are catered by its Subic terminal.

Fuel retailer Jetti Petroleum Inc. has started the construction of a P1-billion bulk terminal in Mariveles, Bataan, a facility with a rated storage capacity of 68 million liters. The project was granted a five-to seven-year income tax holiday and other incentives as endorsed by the Department of Energy (DOE) under the Downstream Oil Industry Deregulation Act. The company is also spending up to P100 million to bring its network of 100 retail stations to at least 120 this year. Jetti Petroleum Inc. has opened three additional stores in the first three months of the year. Two of the new gas stations are in Iloilo and the third is in Davao. The company has also launched its newly renovated flagship branch in Macapagal Boulevard, Pasay City. Its expansion plans also include setting up stations in Novaliches, Quezon City, Bacolod, Kalibo, Aklan, and Roxas City.