Petron earmarks 115-B capex for PH, Malaysia expansions
Leading oil firm Petron Corporation will earmark R15 billion worth of capital expenditures (capex) this year for investment expansions domestically as well as on its Malaysian operations.
According to Petron Chief Finance Officer Emmanuel L. Eraña, R5.0 billion will be funneled for Malaysian expansion -- primarily for the rollout of additional 50 retail stations and the continued implementation of its refinery upgrading.
Petron General Manager Lubin B. Nepomuceno indicated that the target for Malaysia will be 1,000 stations over five years – or until year 2024. Presently, the oil company has 600 rebranded stations from its 2012 asset acquisition from ExxonMobil.
At its Port Dickson refinery in Malaysia, Petron is installing a hydro treater unit to take out sulfur from fuel, so the oil firm could meet Euro 5 quality of petroleum products to be enforced in that market by year 2020.
Nepomuceno said this will be targeted for completion around 2020 also, in time to full compliance to the fuel standards of Malaysia. For that particular refinery upgrade, the company has programmed multi-year spending of US$100 million.
“By 2020, we should be operational because the new specification for Malaysia which is Euro-5 would set in in 2020,” he said.
For the Philippine market, capital outlay this year will be R10 billion, chiefly for the planned additional 150 gasoline stations and other efficiency enhancement works at its refinery in Bataan.
“We only have two major projects – network expansion; and then the improvements in the refinery,” Eraña said.
Petron President Ramon S. Ang said the refinery expansion will beef up the company’s Limay refining capacity by 100,000 barrels per stream day – shoring it up then to the level of 280,000 barrels per day.
Nepomuceno added “we are earmarking 200 stations a year. We have an organization that continually looks for opportunities to acquire more land, dealers and built stations.”
Meanwhile, Erana further indicated that fresh round of capital spending may be decided next year on its proposed continuous catalytic reformer unit (CCRU), an upgrade that will enable the oil firm to produce more petrochemical products like mixed xylene, toluene and benzene.
Nepomuceno stressed that the detailed engineering design and other technical facets of the planned refinery expansion are still due for completion this year, hence, a final investment decision will likely be due in 2019.
Following that, he stressed that the company will still need to review the economics and it will only be that time that the magnitude of capital spending and the refining plant’s final capacity expansion be determined.
Earlier, fuel firm Petron Corporation has booked a slightly higher income in the first quarter of the year amid stable and improved operating efficiencies at its Bataan refinery.
Petron disclosed that its consolidated net income reached R5.8 billion during the first three months of the year and even if its only 4 percent higher than its R5.6-billion income in the same period last year, this is the company's "highest quarterly income in history."