PILIPINAS Shell Petroleum Corporation (PSPC) has asked the Makati Regional Trial Court to lift Executive Order 839, which put a cap on prices of petroleum products as a result of the state of national calamity declaration made by President Gloria Macapagal-Arroyo last month.

The President’s order, which took effect on October 24, directed oil industry players to maintain prices of petroleum products prevailing on 15th October 2009.

Sun.Star accepts donations for victims of Typhoon Ondoy

In a 78-page Petition for Prohibition, Mandamus and Injunction filed Thursday, PSPC pleaded for the immediate issuance of a Temporary Restraining Order (TRO) against the continued implementation of the said EO on grounds of unconstitutionality.

Shell also stated that EO 839 is “in direct contravention of Paragraph 2, Section 23, Article VI of the Constitution” noting that “through EO 839, the President, and not Congress, unilaterally determined the existence of exceptional circumstances warranting the direction of the oil firms, including Shell.”

“Further, EO 839 states that the exercise of emergency powers is based on Section 14 (e) of the Downstream Oil Industry Deregulation Act of 1998 (or Deregulation Law). However, the Deregulation Law is not the emergency legislation required under the Constitution since it does not contain reasonable terms and restrictions set by the latter,” the petition stated.

PSPC similarly raised serious concerns on the long-term peril of EO 839 on the oil industry and the over-all business and economy, which outweighs the intended benefits to the people.

An equally grave consequence, EO 839 may logically result in supply shortage, rationing of petroleum products, and the development and growth of illegitimate market for oil products in the country.

“Executive Order 839 failed to meet certain conditions prescribed under the Philippine Constitution, including the determination of exceptional circumstances warranting the exercise of emergency powers, among others,” said vice president for communications Roberto S. Kanapi.

“EO 839 amounts to grave and irreparable injury not just to Shell but to the oil industry and the country’s overall business climate and its international reputation. We are hopeful that with the filing of this petition, EO 839 will be lifted and we can all move forward and focus on our core priorities of nation building and the rehabilitation of the areas affected by the typhoon,” the company’s petition further read.

Energy Secretary Angelo Reyes said he will call oil companies for a meeting this coming Monday to determine the current situation and the reported objections of the oil companies to continue to adhere to EO 839.

Earlier, independent oil companies warned that they will increase prices of fuel by as much as P4 per liter once the government lift EO 839.

LPG prices

In a related development, oil giant Petron Corp., has increased prices of its liquefied petroleum gas (LPG) by P3.50 per kilogram effective 6 a.m. Saturday.

Virginia Ruivivar, Petron’s public affairs chief, said the increase in LPG prices will only be implemented in Visayas and Mindanao while prices of LPG in Luzon will remain the same.

“Retail LPG prices will be unchanged for Luzon while for Visayas and Mindanao these will increase to reflect change in bulk price,” Ruivivar said.

LPG Marketers Association (LPGMA) adjusted LPG prices in Luzon last November 1, despite the existence of EO 839 claiming that it’s their distributor who implemented the price hike and that they are just following what the market dictates.

Because of the price hike, the Department of Energy-Department of Justice Joint Task Force headed by Undersecretary Roy Quiamko raided several LPG warehouses in the country.

Palace appeal

In Malacanang, Press Secretary Cerge Remonde warned oil companies from making grim warning and dire projections, reiterating that the freezing of oil prices in Luzon is only due to the state of calamity.

“We are appealing to them (oil companies) to stop these (warnings and predictions) because it is not helping,” he said following warning that oil companies may raise their prices by P4.50 per liter once the Executive Order 839, which froze oil prices at the October 15 level, is lifted.

The Palace official added that they are just letting the oil companies to let off some steam, stressing is a normal reaction as the petroleum firms are concerned about their profits.

Remonde said he does not want to go on a word war with the oil firms.

“But we are determined, the President is determined to protect the interest of the consumers in this time of calamity where people need to really, need all the help and assistance that they can get so they can recover from the calamity, at least here in Luzon,” he added.

He also denied that the government is already considering to partially lift the price cap following reports that Justice Secretary Agnes Devanadera mentioned of a possible partial lifting of the executive order.

Remonde said he has personally asked Devanadera about the supposed statement, but the justice secretary has denied it.

“What Secretary Devanadera said is that the joint task force continues to monitor oil supply as well as the situation of the prices of oil products… and also continues to have dialogue with the players in the sector but definitely they are not making any recommendation.” (MSN/JMR/Sunnex)