Eastern eyes tie-up with 3 new oil players

Eastern Petroleum Corp. (EPC), one of the aggressive new players in the downstream oil industry, is looking at the possibility of entering into a tie-up with three new oil companies to expand its field of operation to include liquefied petroleum gas (LPG).

LPG, otherwise known as cooking gas, is one of the fastest growing segments of the local oil industry with an annual growth of five to 10 percent in the past years.

At present, majority of the LPG market is controlled by the so-called Big 3 oil firms — Petron Corp., Pilipinas Shell Petroleum Corp., and Caltex Philippines Inc.

EPC chairman Fernando L. Martinez said he will hold talks with Totalfinaelf Philippines, Liquigaz and Pryce Gas.

"It is premature to discuss the nature of the agreement but we are looking at entering into a co-branding scheme with any one of them," he said, declining to elaborate on the details of possible partnership.

Of the three new LPG players, Totalfinaelf is considered as the most aggressive. In 1999, the company acquired a 15-percent stake in Shell Gas Eastern Inc. which owns an LPG import and storage terminal in Tabangao, Batangas.

At present, EPC’s 30 stations in Metro Manila are focused on retailing gasoline, diesel and kerosene products.

EPC is aggressively expanding its business this year. By next month, it plans to put up more service stations in Mindanao particularly in Davao, General Santos City and Cotabato.

The company intends to spend at least P40 million to P60 million of its total P100-million capital expenditure budget for its expansion program for 2002.

The firm is also putting up new retail stations in other parts of Metro Manila and nearby areas such as in Sta. Rosa in Laguna, Marikina and Pasig.

The company expects to increase the number of its service stations to 100 by end-2003. – Donnabelle Gatdula