Total bullish on growth prospects for lubricants market in RP

Singapore – Total Oil Asia Pte. Ltd. is bullish on the growth prospects of the lubricants market in the Philippines, a ranking company official said.

In a tour of the Total lubricants facility as part of a four-day visit by Filipino energy reporters sponsored by the United States Agency for International Development’s Energy and Clean Air Project, Total Oil Asia managing director KC Foo said there is an encouraging rise in the demand for lubricants in the Philippines over the past months.

Foo said Total Philippines has significantly increased its lubricants supply requirement to 39,000 containers from only 9,000 containers the previous months. Each container contains 16,000 liters of lubricant oil.

"It seems that the demand has increased and we are going the direction of sustained growth in lubricants’ share in the Philippines," Foo said.

Total is the world’s fifth largest lubricants supplier, following Shell, Exxon Mobil, Chevron Texaco, and BP Castrol.

Foo noted that the Asia Pacific region’s demand for lubricants has been steadily growing for the past years. "The lubricants market has been sustained by a strong GDP (gross domestic product) growth in Asia-Pacific," he said.

He also expects this trend to continue in the next five years as economies in the Asia Pacific are projected to continue to grow by 2.3 percent in 2011 as against 1.7 percent for the rest of the world.

"Asia Pacific will capture 60 percent of the long-term market growth," he added.

Total, under the brand name Elf, currently ranks third in Europe in terms of lubricant sales and second in Africa.

It is also the leader in the European market in terms of refining and marketing with interest in 28 refineries and refining capacity of 2.69 million barrels per day and volumes sold at 3.77 million barrels per day. It has 16,857 service stations in this region.

Overall, Total, listed at the New York and London stock exchanges, is the fourth largest oil company worldwide.

In 2005, the oil giant registered a net income of $14 billion, a 55-percent rise from the previous year’s $9 billion.

This year, Total is committed to spend some $13.9 billion in capital expenditures for its worldwide operations. Foo declined to give details of Total’s capex for the Philippines.

Total started supplying lubricants to the Philippines in 1997 and joined the bandwagon of small oil importers in operating retail business in the Philippines in 1998 when the Oil Deregulation Law was passed.