Oil majors set up biodiesel facilities in Pandacan depot

The country’s three major oil players may have yet another reason to stay at the Pandacan oil depot.

Petron Corp., Chevron Philippines Corp. and Pilipinas Shell Petroleum Corp. said yesterday that they have set up facilities to comply with the Biofuels Act mandating a one percent blend of coco-methyl ester (CME) in diesel products.

The three oil firms’ effort to meet the mandate of the new law, however, may counter the Supreme Court’s order for the oil players to vacate and/or transfer to another location despite the efforts of the oil warehouse’s locators to scale down their operations over the past years.

"This is why we have to explain to the Supreme Court the importance of the Pandacan depot," Energy Secretary Raphael P.M. Lotilla said.

According to Petron terminal manager Danny Billedo, "we do not have a choice but to comply with biofuels law. We did not add new tanks. We just converted existing diesel storage tanks to house the pre-blended biodiesel."

Petron started pre-blending biodiesel, a few days before May 6, the mandated implementation of the one percent biodiesel blend.

It was, however, not established if the conversion process of the oil companies still meets the pre-blending criteria for biodiesel.

Petron said it has converted five tanks to be able to pre-blend and store CME in their facilities in Pandacan.

A Chevron official added they have dedicated three tanks for biodiesel. Shell, for its part, said it is doing the so-called in-line blending wherein diesel coming in from their respective refineries in Batangas would pass through the pipeline and blended with CME once it reaches the Pandacan terminal.

Industry observers said the oil companies’ compliance to the new biofuels law would be disrupted if it would be forced to relocate to other locations.

The Biofuels Act mandates a minimum one percent blend of biodiesel into all diesel engine fuels. It also mandates that at least five percent bioethanol shall comprise the annual total volume of gasoline fuel sold in the country within two years.