Non-OPEC petroleum products to arrive before 2018 ends —DOE

Petroleum products from non-OPEC producers are expected to reach the country before year ends to beef up supply and help mitigate the impact of rising oil prices, according to the Department of Energy (DOE).

The department tasked the Philippine National Oil Company-Exploration Corporation (PNOC-EC) to look into the possibility of sourcing oil from non-OPEC members, such as Russia, and use the stockpile to establish a strategic petroleum reserve (SPR).

The move is expected to cushion the effects of surging international oil prices, said Candido Magsombol, PNOC-EC vice president for Downstream Operation.

“The directive to PNOC-EC is to import stockpile, store and distribute petroleum products. The intention is to have a price that will help the consuming public to protect from oil surge but it should be sustainable as well,” he said.

To bring down the cost of supply, the government is to haggle the best possible price and enter agreements with foreign counterparts.

“What we envision from the supply side is to use our relationship with national oil companies and oil producers internationally to get a better price,” Magsombol noted.

The government is now in talks with private oil companies, which have existing facilities such as storage and gas stations to make non-OPEC fuel available to consumers.

PNOC-EC may enter a supply agreement, form a joint venture, and perhaps put up its own retail stations to compete with oil industry players.

Director Rino Abad of the DOE Oil Industry Management Bureau said establishing an SPR and making the petroleum reserves available to the public could bring down local pump prices.

“Dahil government sila [PNOC-EC], hindi na violation sa deregulation law per se ‘yung pag cap ng profit margin. Pwede pa maitarget ‘yon sa dapat mabigyan ng opportunity like PUV,” he said.
 
Abad noted that PNOC-EC is a government-owned and -controlled corporation, with its people bound by the Salary Standardization Law. As such it would be cheaper to operate than if it were a private firm embarking on this endeavor. —VDS, GMA News