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Pilipinas Shell takes heat from lawmakers over LPG facility

February 11, 2014 3:43pm
Lawmakers on Tuesday pilloried Pilipinas Shell Petroleum Corp. for decommissioning and shutting down its refrigerated liquefied petroleum gas (LPG) storage facility in Tabangao, Batangas despite the ongoing supply shortage of the commodity, saying its decision can induce LPG prices to rise.
Liquefied Petroleum Gas Marketers Association (LPGMA) party-list Representative Arnel Ty criticized Shell officials over the timing of the decision to close its LPG storage facility. The company could have waited a little longer before decommissioning the facility, he said.
“Why decommission it now? Why did you decide immediately? Hindi ba ninyo naisip ang implication nito for consumers?” Ty said.
Manila Rep. Rosenda Ann Ocampo noted the company let “customers fend for themselves” by shutting down the facility at the height of a supply shortage.
Roberto Kanapi, Shell vice president for Communications, said the company decided to decommission the storage facility because it is no longer economically viable to continue its operations.
When the facility was built in 1983, it was meant to service not just local LPG companies but also clients from neighboring countries, he said.
“The viability of operating the facility has been affected now that our Asian customers have constructed their own storage areas,” Kanapi said. “Operating the 30-year-old plant will require substantial investments from us to ensure its reliability and safety,” he added.
Ty earlier warned of a P5 increase in LPG prices if the national government would not take over the Batangas facility.
The lawmaker said the shutdown has forced LPG dealers in Southern Luzon – who were sourcing their LPG from Batangas – to buy their supply from the Bataan refinery. 
Bataan is around 208 kilometers northeast of Batangas. – VS, GMA News

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