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Thursday, December 27, 2007
Oil firms announce roll back
MANILA -- Petron Corp. and independent oil player Eastern Petroleum announced the cutting back of prices of gasoline, diesel, and kerosene starting 2 p.m. Wednesday.
Both Petron and Eastern Petroleum will lower down the price of gasoline by P1 per liter while diesel and kerosene by 50 centavos per liter.
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Fernando Martinez, chairman of Eastern Petroleum, said the reduction will only last until December 31 because it is a "special discounts" they are giving to their customers.
Prices of unleaded gasoline were now placed at P44.57 while diesel was P37.60.
Shell manager Ed Chua said oil firms are no longer expecting any price adjustment by year end.
"More or less there will no be movements in oil prices," said Chua.
But he was quick to add: "Everything depends on market forces. So if market forces do not dictate the need then (for price hikes) prices will be kept at its current levels."
However, for diesel, he said they expect another round of increase ranging from 50 centavos to P1.
Aside from gasoline, Chua said they also expect prices of liquefied petroleum gas (LPG) to drop.
"For the LPG, the price is going down so domestic price of LPG can be rolled back," Chua said.
Oil firms implemented the increase in prices of petroleum products on the first week of December while government is looking for ways to cushion the impact of high prices of crude in the world market.
Bio-ethanol products
Meanwhile, oil giant Pilipinas Shell Petroleum Corporation (PSPC) and Basic Energy Corp. has recently signed an agreement for the supply of bio-ethanol products.
Josue A. Camba Jr., chairman of Basic Energy Corp., said Shell asked them to supply 50 million liters of bio-ethanol products annually.
In a disclosure to the Philippine Stock Exchange (PSE), Camba said Basic will be fully operating greenfield bio-ethanol plants with dedicated sugar cane farms, which will give them advantages in feedstock cost.
"This will allow us to lower the cost of the production of our bio-ethanol," Camba said.
The company has also applied for a follow-on offering at the PSE and Securities and Exchange Commission (SEC) expecting to raise P2 billion.
The company is offering 5.5 billion new common shares priced at P0.38 each.
Proceeds from these second offering will be used as equity for its two fully integrated bio-ethanol plants and to fund its expansion in bio-fuels, mining exploration and oil and gas exploration.
The plants will be capable of producing 100 million liters of bio-ethanol per year and will be located in Zamboanga del Norte.
The SEC recently approved an increase in the company's authorized capital stock from 2 billion shares or P500 million to 10 billion shares to P2.5 billion.
Banco de Oro (BDO) Capital and Investment Corp. and other local banks were tapped as lead underwriter for the offering.
Basic Energy, formerly Basic Petroleum Corp., acquired Zambo Norte Bio Energy Corp., which can produce 200,000 liters of ethanol once its commercial operation starts in 2009.
Camba said aside from bio-ethanol, Basic Energy is also eyeing geothermal and other renewable sources of energy. (MSN/Sunnex)
For more Philippine news, visit Sun.Star Iloilo. (December 27, 2007 issue)
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