Senate balks at budget for PNOC-EC diesel importation plans

In the absence of a feasibility study and lack of transparency on its planned P2.0 billion worth of diesel importation, the Senate sounded off that it will defer concurrence to the budget being sought by state-run Philippine National Oil Company-Exploration Corporation (PNOC-EC) for the proposed fuel procurement.

Senate committee on energy chairman Sherwin T. Gatchalian lamented that despite requests made to PNOC-EC for them to submit definitive plan on the diesel offshore purchase, that plea had not been heeded. “We requested that they present it before the (Senate) plenary defense or plenary debate … but they’re just giving us very raw, very broad (information)…I had this feeling that they don’t want us to know what the details are,” the lawmaker stressed.

He thus cautioned that “if ever they cannot present it before the plenary hearing, we will move to defer that budget because we need to understand…we cannot risk the budget of the country on an (oil) trading business.”

For one, PNOC-EC and the Department of Energy (DOE) first announced that they will import cheaper diesel from Russia; then they recently changed sourcing track to Singapore.

Even the quality of diesel to be procured overseas also shifted from Euro-2 as previously announced by the energy department; then that was calibrated to Euro-4 just last week. “We asked them to do a feasibility study for potential distribution of oil products… the problem was, when we already asked for a copy of the report, they cannot show us anything,” Gatchalian narrated.

The lawmaker explained “we want to understand because when you enter into the petroleum trading business, it’s also a very risky business. For example, what if the prices will suddenly drop today or next week and you have an inventory that you cannot sell, then the government will lose money.”