PNOC negotiating for higher Petron lease payments
State-run Philippine National Oil Company (PNOC) is negotiating for higher lease payments for the array of properties being rented out to leading oil firm Petron Corporation.
PNOC President Reuben S. Lista indicated that for the 4.3 hectares being leased to Petron for its oil facilities at the government-company’s Mabini property in Batangas, lease payments had just been pegged at R475,000 annually – apparently a losing proposition for the State.
The state-run firm is similarly demanding from Petron back rentals from 2008 to 2016 of R1.44 million for the use of a pipeline stretching from its pier to its petroleum facilities at the PNOCowned Mabini real estate.
Beyond the Mabini property, PNOC noted that Petron is also under lease for roughly 120 lots it owns – part of these would be sites for 68 gasoline stations plus depots and bulk terminals in La Union (Rosario, Bacnotan and San Fernando), Iloilo and Cebu, among others.
On the Mabini lot, Lista noted that the lease agreement will expire August next year but negotiation with Petron already started on whether they would opt for renewal or not – with discussions centered primarily that the cost of the forward lease arrangement will be “at market”.
The PNOC chief executive noted for the rest of the 11-hectare Mabini land being leased by the company as energy storage base (ESB) to other entities, it has been earning R130 million on a yearly basis.
“If Petron gets out of there now, we will make more money … if they are not interested anymore, then we will open it up to others,” Lista said.
He qualified though that since “Petron needs that, because that it is their base towards the other islands – I am not also a saboteur, so I am giving them the chance.”
Lista said in initial talks with Petron, their company already laid its cards on the table, hence, they are expecting the oil firm to make counter-offer during their scheduled January 13 meeting.
“Petron is our child – we used to own Petron, but they have to pay me better… I am happy that they became the biggest, but it is also their turn to help the ‘orphaned mother’, because everything that we had with them were sweetheart deals,” he said.
The management team of Petron led by its chief executive officer Lubin B. Nepomuceno already paid PNOC courtesy visit and that also jumpstarted discussions on their future lease pacts.