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Business

Growing amidst the pandemic

HIDDEN AGENDA - Mary Ann LL. Reyes - The Philippine Star

Despite the COVID-19 pandemic, the country’s leading independent and homegrown oil firm has retained its third-place ranking among the mythical “Big 3” oil players in the local market.

According to latest data from the Department of Energy, as of the first quarter of 2021, Phoenix Petroleum ranked third in terms of total domestic market share for both petroleum products and liquified petroleum gas (LPG). Phoenix posted a marginal increase in market share of petroleum products to 7.8 percent from 7.1 percent as of end-2020. In terms of LPG market share, it managed to get a share of 7.16 percent.

Phoenix president Henry Albert Fadullon pointed out that their first quarter 2021 business results exceeded pre-COVID levels for the first time since the start of the pandemic.

He said that the latest development in market share is a testament to the company’s commitment and priorities, including providing the best offer to customers, maintaining operational excellence, and accelerating growth through streamlined operations and improved resource management.

Fadullon said that despite challenges and setbacks, they have remained determined and optimistic throughout the pandemic.

He said that as quarantine restrictions become more relaxed and the country’s vaccination operations continue, safety remains their top priority. But he stressed that they are now more optimistic, especially after the second quarter of the year yielded stellar results, encouraging the company to look forward to an even more business-friendly environment.

Fadullon revealed that its April business results exceeded pre-COVID levels for the first time since the start of the pandemic, adding that they are now focused on streamlining operations, improving resource management, and efficiency.

Last May, the company reported that overall volume went up year on year, driven by the domestic LPG cylinder business, sharp recovery in commercial and other business-to-business, and sustained strength in its overseas trading business. Net income was at P121.3 million compared to a P386.3 million loss in the first quarter of last year, while operating expenses went down 16 percent YOY, with OPEX per liter down 42 percent on prudent operating and capital spending.

Volume from overseas subsidiaries more than doubled during the period, the company reported in May. The overall business, led by its trading subsidiary in Singapore, remained robust in the first quarter, while its LPG operations in Vietnam eased following consecutive triple digit growth in the prior quarters.

LPG cylinder volume went up 15 percent, with Luzon and Visayas-Mindanao growing 53 percent and 11 percent, respectively. Cylinders, the company said, accounted for almost two-thirds of the business in the first quarter.

Strategic retail partnerships formed in 2018 has grown the network to 676 retail stations as of March 2021.

Doing his job

A consumer group recently criticized Energy Secretary Alfonso Cusi for being preoccupied with the management row in the PDP-Laban political power even while electricity rates remained high during his term.

The criticism hurled by the Power for the People Coalition (P4P) seems to be misplaced.

According to the Department of Energy, Cusi had been proactively resolving power concerns and the P4P was deceived when it comes to appreciating things that he has done to resolve issues in the power industry.

The DOE pointed out that even when the issue involving the competitive selection process (CSP) was pending with the Supreme Court in 2018, Cusi already issued the 2018 CSP policy in order to guide the power industry players on how to procure power in the least cost manner.

It noted that the SC later issued its decisions practically telling the power industry players to follow the 2018 Cusi policy.

In addition, the department issued the 2019 policy for 100 percent ancillary services contracting, and the 2020 policy for the transparent grid operations and maintenance program to address the synchronized scheduling of preventive maintenance of the power plants and the transmission network.

The DOE also completed the mechanisms under the Renewable Energy Act of 2008 which are aimed at facilitating greater private sector investments in renewables, including the participation of electricity consumers in renewable energy development, enabling them to produce their own electricity requirements or to choose RE as their chosen supply.

The RE development measures include the renewable portfolio standards policy, green energy option program policy, and enhanced net-metering system, among others, which are geared towards achieving a 35 percent RE share by year 2030.

It also mentioned the reports made by the DOE to the Cabinet Assistance System to address the compliance needed from the power industry players, considering that under Section 46 of the Electric Power Industry Reform Act (EPIRA), the DOE can only recommend the revocation/cancellation of the franchise to Congress.

The DOE also stressed that during Cusi’s term, he initiated landmark pieces of legislation aimed at resolving problems in the power industry which were signed into law by the President.

These include the Energy Virtual One-Stop Shop (EVOSS) Law to address the timely processing of energy applications and the Energy Efficiency and Conservation Act, upon the presentations made by the DOE.

Cusi earlier said that the DOE is doing its best to improve energy security by tapping indigenous sources, in particular renewable sources, noting that aside from solar, wind, and tidal, they are expanding hydro and geothermal. He pointed out that in fact, geothermal used to be limited only to the Filipinos, but they have opened it 100 percent, through financial and technical assistance projects, to foreigners in order to expand and expedite their development.

Contrary to what the group claims is the country’s increasing dependence on expensive, polluting, and unreliable coal, the DOE has issued a moratorium on the new construction of coal power plants.

Also, in 2015, the Philippine government has submitted an intended nationally determined contribution or initial commitment of a 70 percent greenhouse gas emission reduction to the Paris Convention, but this was increased to 75 percent when President Duterte took charge in 2016.

 

 

For comments, e-mail at mareyes@philstarmedia.com

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