Petron bares P837-M capex

Industry leader Petron Corp. will spend the bulk of its P837-million capital expenditure program on marketing and supply investments, a company official said.

Petron president and chief executive officer Motassim Al-Ma’ashouq said they would set aside 65 percent or more than P540 million for the establishment and re-imaging of more service stations and installing additional equipment for some industrial accounts.

Al-Ma’ashouq attributed the company’s P513 million net income for the first half of 2001 to an improvement in the number of its industrial accounts during the period.

He said that as part of Petron’s supply-related capital program this year, they would relocate their joint fuel facilities with the other refiners at the Ninoy Aquino International Airport (NAIA) to the new terminal. This would allow the company to maintain its lead in the jet fuel market in the country.

The P837-million capital expense program of the company is slightly lower than the P854 million spent in 2000 and much smaller than the P2.136 billion in 1999.

According to Al-Ma’ashouq, the remaining 35 percent of its expenditure program for 2001 would be utilized to enhance refinery efficiency. Specifically, he said they would be conducting detailed feasibility studies for investments to meet the remaining requirements of the Clean Air Act (CAA).

Petron plans to invest about $150 million to upgrade its refineries to comply with the Clean Air Act. The 1998 CAA mandates oil firms to scrap leaded gasoline by 2000. It also provides that the aromatics and benzene content of unleaded gasoline be brought down to four percent and three percent, respectively in 2003, while the diesel’s sulfur content should be brought down to .05 percent in 2004 from current level of .2 percent. – Donnabelle Gatdula