Pertamina to supply additional oil to RP in case Iraq crisis worsens

The Philippines has successfully tapped Pertamina, Indonesia's largest oil conglomerate, as a possible source of additional oil supply in the event of a full blown crisis in Iraq and the Middle East.

Pertamina and its counterpart, Philippine National Oil Co. (PNOC) have negotiated for a commercial arrangement as part of the Department of Energy (DOE)'s thrust to ensure steady supply of oil in case of emergency.

"Indonesia through Baihaki Hakim, president of Pertamina, has committed to provide additional oil supply for the country. This will provide us with a back up contingency plant to ensure security and reliability of oil supply in the domestic market," PNOC president and chief executive officer Thelmo Y. Cunanan said.

Cunanan was the one who negotiated the deal with the Pertamina officials.

The commercial arrangement between Pertamina and PNOC was an offshoot of the discussions initiated by Energy Secretary Vincent S. Perez with Indonesia Minister of Energy and Mineral Resources during the recently held 8th World Energy Forum in Osaka, Japan.

"Indonesia is one of the major oil producing countries. We are pleased that as part of the ASEAN commitments, we could depend on other member-countries particularly Indoneia to provide us the additional oil supply," Perez said.

The energy chief assured that the country has a steady supply of oil as it continues to pursue bilateral arrangements with other countries as alternative sources.

The government is sending a high-level mission to Russia by the end of this month to facilitate a possible supply arrangement.

Saudi Aramco, which owns 40 percent of Petron Corp., has also indicated its commitment to provide additional supply.

Tapping at least three possible sources of oil outside of Middle East is part of the Oil Contingency plan of the DOE.

The strategy is to diversify the sources of oil so it could be able to readily tap these market/countries if the need arises.

Based on the plan, the government will increase the oil inventory of the country to at least 60 to 90 days. The first 60 days are expected to be covered by the local oil firms and the remaining 30 days will be shouldered by the government.