Petron H1 income up 16% to P2.7B

Petron Corp., the country’s largest oil refiner, reported a net income of P2.7 billion in the first half of 2006, a 16 percent increase from P2.3 billion in the same period last year.

In his report to stockholders yesterday, Petron president and CEO Khalid D. Al-Faddagh said the growth in earnings was brought about by higher export volumes and favorable international prices.

Expecting bright export business prospects to be sustained in the next four years, Al-Faddagh said they expect earnings to reach P10 billion in 2010.

Expressing the same optimism on the export venture, Petron chairman Nicasio Alcantara said they are also carefully studying the proposed $3 billion new "crude unit" in Mindanao or in Bataan.

"We have an old plan to build a refinery in Mindanao. But we have yet to determine the economics and details of the planned new crude unit," he said.

Alcantara said at current estimates, putting up a refinery with a capacity of 200,000 barrels of oils per day would cost them more than $3 billion. 

He said the new refinery is part of government’s overall thrust to ensure the steady supply of oil in the country amid uncertainties in the global crude market. 

But Alcantara admitted that at present, they are focusing on the upgrading of their existing refineries.   

The company has spent $100 million to produce Clean Air Act-compliant products through the construction of hydrotreater and isomerization plants.

The oil firm is also investing some $300 million for its petrochemical projects.  Scheduled for commissioning in 2008, the petro fluidized catalytic cracker unit will allow the company to produce more high-value white products and extract the petrochemical grade propylene.