"We are trying to resolve first the issue of (rising) oil prices. I think the IPO is secondary in our priority right now," Energy Secretary Vincent S. Perez said.
But Perez said, they are still in discussions with the Department of Justice (DOJ) on the possible amendment of an earlier DOJ opinion favoring the delay in the IPO of the oil firms.
"We have to amend it first so we can enforce the law stringently," Perez said.
The DOE was earlier keen on compelling Pilipinas Shell Petroleum Corp. and Caltex Philippines Inc. to offer at least 10-percent stake to the public through an IPO.
"We are not neglecting our obligation to implement the law. We are just waiting for the DOJ’s opinion," Perez said.
Perez said both Shell and Caltex would still have to undertake an IPO although the latter decided to recently close its oil refinery.
"We believe Caltex will still have to undergo an IPO through Calserv, its marketing arm. We are still studying this," he said. CALSERV is engaged in direct retailing market through eight retail stations and convenience stores under Caltex and Star Mart brands, respectively.
Under the Oil Deregulation Law, "any person or entity engaged in oil refinery business shall make a public offering through the stock exchange of at least 10 percent of its common stock within the period of three years from the effectivity of the Act or the commencement of its refinery operations." The oil refiners should have carried out their respective IPOs in Feb. 2001.
Caltex and Shell have been using the previously issued DOJ opinion as a shield to skirt the IPO provision of the Oil Deregulation Law.
The DOJ opinion said "based on the prevailing economic conditions, it is expected that an IPO at this time may well fall short of the norms of a successful offering both in terms of pricing and distribution if undertaken within the period."