Shell to start selling ethanol-blended gasoline next month

Pilipinas Shell Petroleum Corp., the local unit of the Royal Dutch Shell Group, will likely start selling ethanol pre-blended gasoline or E10 at its stations next month, the Department of Energy (DOE) said.

A ranking energy official said this is in line with Shell’s efforts to support the government’s alternative fuels program.

"There are just some last concerns being sorted out before ethanol can finally be offered commercially at Shell gasoline stations.It would be at 10-percent blend initially," the official said.

According to the official, Shell is also trying to seek a permit for the facility that will handle ethanol products at the Pandacan depot. If the necessary documents would be approved, Shell may start providing the product by early May, Shell the first among the major oil players to introduce the pre-blended gasoline in the market.

Petron Corp., which is partly government-owned, had also initially indicated plans to introduce such product.

A small oil player, Seaoil Philippines Corp. was first to carry ethanol pre-blended products in its stations in the third quarter of 2005. Eventually, the product was also selectively offered in Flying V stations. The initial batch of ethanol supply in the country were imported from Brazil until such time that local projects go on line starting 2007.

With the continuing volatility in global crude prices, the DOE had been pushing the country’s oil firms to consider using alternative fuels.

On top of this effort, the government is also considering the reduction of the tariff on imported petroleum products from the existing three percent to one percent to lessen the impact of rising international crude prices on oil consumers.

Energy Secretary Raphael P.M. Lotilla told reporters during the first Economic Journalists Association of the Philippines (EJAP) forum that the proposed lowering of duties on imported oil will result in an average 50-centavo per liter cut in prevailing pump prices and would somehow ease the impending increases due for implementation by the oil companies.

The DOE is also urging Congress to pass the proposed Biofuels Act which will mandate the use of a certain percentage of alternative fuels such as coco-biodiesel and ethanol.

The bill will also grant incentives for investments in putting up facilities for such ventures.