Petron sees income tripling to P18 billion this year

MANILA, Philippines — Oil refiner Petron Corp. sees its earnings tripling to P18 billion this year as it hopes to sustain the increase in sales volume on the back of easing mobility restrictions.

Petron president and CEO Ramon Ang said the improved profit would be pumped in by the combined operations in the Philippines and Malaysia.

“Easily, it can reach P18 billion, of which Malaysia (operations) will deliver P12 billion,” he said recently when asked about growth prospects this year for the country’s only remaining oil refiner.

Last year, Petron posted a net income of P6.14 billion, recovering from a net loss of P11.4 billion the previous year.

In the first half of the year, Petron doubled its net income to P7.7 billion from P3.9 billion a year ago. Net sales grew by 129 percent to P398.5 billion from P174.1 billion, driven by the sustained increase in sales volume and prices.

Petron said the benchmark Dubai crude averaged $102 per barrel from January to June as supply concerns persisted due to geopolitical conflicts.

In its first half report, the company said sales volume improved across all trades, with commercial sales posting the highest increase as more industries, including aviation travel, rebounded from the pandemic’s impact.

Among the different segments, the total retail business of the group posted a nearly 30 percent uptick, fueled by the strong sales of its premium gasoline and diesel fuels.

Sale of lubricant products, Jet-A1, liquefied petroleum gas, and petrochemicals likewise showed strong growth compared to the previous year, the company said.

Petron said it benefited from the strong regional refining margins, with higher production at the refinery.

Ang said this came following Petron’s massive $2-billion upgrade at its Bataan refinery, which increased its local production of gasoline, diesel, and petrochemicals.

Petron announced its refinery upgrade in 2018, with the aim of increasing the capacity by 55 percent.

Petron has a combined refining capacity of 268,000 barrels-per-day and produces a full range of world-class fuels and petrochemicals.

It operates about 40 terminals in the region and has around 2,800 service stations where it retails world-class gasoline and diesel.

Asked about selling Petron back to the government or to other buyers, Ang said there are no plans.

Ang noted that while he can easily sell Petron back to the government, even through installment over five years, it would be difficult for the government as it would have to spend billions to subsidize operations because the public transport sector would likely demand for discounts.