Prices feeding fuel search boom

In terms of the oil and gas exploration, it’s business as usual

Energy projects using both indigenous and conventional sources are again expected to boom with the record prices of petroleum fed by the global economic upsurge.

Private firms are priming for a resurgent search for fuel.

It’s business as usual for ACE Enexor (ACEX) despite the planned property-for-share-swap scheme with parent firm AC Energy Corp. is undertaking to pave the way for the relinquishing of all thermal assets by 2025.

In a press briefing, AC Energy president and chief executive officer Eric Francia said oil and gas exploration remains unaffected by the move, which is part of the firm’s commitment toward a net-zero greenhouse gas emissions by 2050.

“We haven’t made a decision yet on the specific timing and the method of the spinoff of Enexor. Our default is that it would remain within the group, the AC Energy and Infrastructure Group, but we are spinning it out of ACEN,” Francia said.

“In terms of the oil and gas exploration, it’s business as usual. We are still discussing this with potential partners. We’re still hoping that the Philippines can get going with the development of indigenous resources, especially given the global energy crisis,” he added.

Spike until 2022

Energy Secretary Alfonso Cusi expect prices of oil products will be on the rise until early next year as a result of the current shortage in crude oil supply.

Global supply is short of around 3 million barrels per day (bpd) as oil producers and exporters are only supplying 100 million bpd while demand is at 103 millions bpd.

The Organization of Petroleum Exporting Countries and its allies (OPEC+) is sticking with a plan to marginally increase output until April 2022.

Cusi said although the Philippines is able to get the needed supply of 435,000 bpd, oil prices still depend on the global market trend.

For the past two months, local prices of diesel have gone up by more than P8, gasoline by P7 and kerosene by P8.

Cusi said the government will try to cushion the impact of the price shock.

“DoE (Department of Energy) opposed the fare hike. Let us find a way like the Pantawid Pasada and all other subsidies that we can provide for the public sector,” he said.

Taking into account that oil price spikes may repeat in the future, Cusi said the DoE has asked lawmakers to amend the oil deregulation law.

“The changes will give DoE more authority in cases like this and to get back (the) government’s participation in oil trading,” he added.