Chevron to retain PH downstream oil business

Amid its anticipated pullout from the Malampaya gas field project due to a ‘highly tempting’ purchase offer from Davao businessman Dennis Uy, American energy giant Chevron Corporation indicated that it will be maintaining its downstream oil business in the Philippines – which primarily carries the Caltex brand.

According to Cameron Van Ast, external affairs advisor for Chevron Asia Pacific, the company remains “committed to our downstream operations in the Philippines and will continue to be a reliable provider of quality fuel products and services in the country.”

Of the major industry players in the downstream oil sector, it is Chevron that has to work harder on maintaining its number three rank as the Phoenix Petroleum Philippines Inc. of Uy has already been gobbling up into its share of the market and giving it a real cutthroat competition.

With the American firm’s pullout from the Malampaya venture, the core of its business in the Philippines will already be significantly reduced – especially so since it also exited its geothermal business in the Philippines in 2017.

Lawyer Raissa Bautista, manager for policy, government and public affairs at Chevron Philippines, indicated that the downstream segment of their business still has a portfolio of 650 sites for retail network; six operated and 12 non-operated terminals.

She emphasized “we continue to sustainably grow our Caltex retail footprint with more retail sites expected to open by the end of 2019,” stressing that this will be in addition to the roughly 100 stations that the company had brought to commercial operations within the period of 2016 to 2018.

“We are also enhancing resources to serve the growing fuel and lubricant needs of the country’s commercial and industrial segments where we have expanded our customer base,” Bautista said.

In Chevron Malampaya’s sale of its 45-percent stake to Udenna Corporation, it remains a puzzle as to who would be the deep-pocketed partner that Dennis Uy will be bringing into the deal. Currently, Uy has a standing partnership with China National Offshore Oil Corporation (CNOOC) for upstream oil and gas investments in the country.

A sale and purchase agreement (SPA) had been signed by the parties last month, but this transaction will still be subject to the “right of first refusal” of the Malampaya project partners, primarily Shell Philippines Exploration B.V. (SPEX) which is the operator and shareholder of the other 45-percent majority equity.