The facilities – a 22,000 barrel per day (bpd) GOHT and a 10,000 bpd light virgin naphtha Isom unit – will give Petron an edge over oil firms that import expensive petroleum products in the region.
The GOHT significantly reduces the sulfur content in diesel while the Isom enables the production of high-octane gasoline within the CAA-prescribed limits on aromatics and benzene, at 35 percent and two percent, respectively.
"We have always endeavored to meet environmental standards set by the government through the Department of Environment and Natural Resources (DENR). These facilities will give us the ability to produce fuels that could match the more stringent product specifications in Europe and the United States," Petron chairman Nicasio I. Alcantara said.
"More importantly, the country now has a reliable and steady supply of clean fuels amid uncertain conditions in the global oil market," he added.
Since the passage of the CAA, oil companies have resorted to importing fuels and/or blending components to meet the law’s more stringent product specifications. Even refiners like Petron imported products due to process limitations.
Alcantara said the new units will eliminate the need for product imports and will result in dollar savings for the country. He did not elaborate on how much savings would be generated from these two new refinery projects.
In June 2004, Petron signed a $100-million, five-year term loan with Norddeutsche Landesbank Girozentrale’s Singapore branch and its three arrangers namely Citibank/Citigroup Global Markets Asia, ING Bank N.V. and SAMBA Financial Group of Saudi Arabia.
The loan has an interest margin of 120 basis points over the three or six month LIBOR. The term loan was used to construct the GOHT and Isom.
"Our loan set a benchmark for having the lowest cost in the market which reflects the banking community’s confidence in Petron’s viability and growth prospects," Petron president and CEO Khalid D. Al-Faddagh said.
"Our investment in the GOHT and Isom highlights our belief in the Philippine economy, and our desire to contribute to its progress," he added.
In the last quarter of 2004, Petron’s Bataan refinery achieved another significant milestone when its Environmental Management System was given an ISO-14001 certification.
The refinery was given the certification after only one round of grueling environmental audits by TUV Suddeutschland (SUD) Group.
"Our decisions relating to environmental initiatives consider a balance of their contribution to the bottom line and a commitment to sustainable development and the welfare of future generations," Al-Faddagh said.
Petron’s 180,000 bpd refinery processes crude oil into a full range of world-class petroleum products including liquefied petroleum gas (LPG), gasoline, diesel, jet fuel, kerosene, fuel oil and mixed xylene. – with Raffy Viray