New oil firms may now set up service stations along expressways, says Perez

To further level the playing field, the new oil players are now allowed to set up gasoline stations and service facilities along the north and south expressways, Energy Secretary Vincent S. Perez said.

Perez said this resulted from a series of discussions with the Philippine National Construction Co. (PNCC) which started last July, a few months after the energy secretary took office in March 2001.

According to Perez, the PNCC is expected to complete the terms of reference (TOR) of the public bidding for the construction of gasoline stations and other service facilities in the area this week. The bidding he said, is set for next month.

For her part, Totalfinaelf Philippines Inc. (TPI) corporate communications manager Rona Quejada said this is a welcome move.

"We appreciate the efforts of the DOE and the PNCC to resolve the issues. Now, we will start identifying the sites and revive our plans to build stations along the expressways. Cost of constructing a fully-furnished station is about P100 million," she said.

Glenn Yu, president of Seaoil Petroleum Corp., said they will start evaluating their pending application to build new service stations along the area. "I haven’t seen the entire resolution yet but I am happy with the decision. We will revisit our previous plans," he said.

The energy chief said the TOR will include the guidelines on the technical and financial capabilities of the firms keen on operating gasoline and service facilities along the expressways. Service facilities include convenience stores, cafeterias, mini-restaurants, shops and rest areas, which are necessary for the travelling public.

Perez said the move to allow other companies to build facilities along the superhighways indicates the government’s strong economic policy of the free enterprise and fair competition.

"We are fully satisfied that finally the new players in the downstream oil industry and other non-oil companies can already construct their service facilities along the north and south expressways. We are aware that they have been batting for the right to operate facilities in the area for many years now. The Downstream Oil Industry Deregulation Law of 1998 specifically calls for a level playing field for everyone. Allowing their entry along the expressways gives a strong push towards this end," Perez said.

The energy secretary said this will not only bring in additional revenues for PNCC in terms of tax and royalty fees but will also create jobs for many people starting with the construction to the actual operation of the facilities.

New oil companies such as Total, PTT Philippines Inc., Seaoil and Unioil Petroleum Philippines Inc. filed separate applications with the PNCC three years ago to construct facilities along the expressways.

Their applications, however were deferred because of the earlier memorandum of agreement (MOA) among major oil companies – Petron Corp., Pilipinas Shell Petroleum Corp., and Caltex Philippines Inc., and PNCC giving "exclusive" rights on the use of expressways.

At present, the major oil firms have identified three sites each for their respective facilities along the stretch of the expressways.

PNCC chairman Luis Sison said the Office of the Government Corporate Counsel (OGCC), in a legal opinion, declared that the earlier MOA has been rendered invalid with the enactment of the Downstream Oil Industry Deregulation Law.

Sison said under the new guidelines, PNCC will apply uniform tariff rates for both the major and new firms interested to construct new facilities in the area to fully achieve fair competition and eventually provide efficient service to the end-consumers.