MANILA, Philippines - Petron Corp., the country’s largest oil refiner, is planning to put up its own power plant to reduce its expenses.
“The primary objective, if ever we were to pursue this, is to meet the refinery demand,” Petron president Eric Recto told reporters over the weekend.
Recto said this move is part of the overall efforts of the company to manage its operating costs, particularly power costs.
“We plan to go into self-generation to manage our costs,” he said.
Late last week, Petron disclosed to the Philippine Stock Exchange (PSE) its plan to amend its articles of incorporation specifically the change in primary purpose to include generation and sale of electric power.
The move could be related to the consolidation of San Miguel Corp.’s strategy.
SMC has acquired shares in Petron and Manila Electric Co. (Meralco).
But officials of Petron pointed out that what the oil company is planning to do is just to become a self-generating firm and produce the power that it needs for its operations.
SMC has been acquired intensifying its efforts to engage in the energy-related businesses, both oil and power sectors.
The conglomerate has signified its keen interest to bid for the 620-megawatt combined cycle power plant in Limay, Bataan. Petron’s refinery is located in Limay.
“There no definite plans yet. But I think that is already covered under our vision/mission and that is to provide customers with total energy solutions,” a Petron official said.
Petron also disclosed that its board also proposed an increase in capital stock to P25 billion from P10 billion through the issuance of preferred shares.
In 2008, Petron reported that it incurred a net loss of P3.9 billion, a complete turnaround from the P6.4-billion net income in 2007 due to a drop in margins.
Earlier this year, the government’s share, through the Philippine National Oil Co. (PNOC), in Petron was sold to Ashmore which was later purchased by SMC.
At the end of 2008, Petron had a total service station count totaling 1,288 nationwide—the largest in the country.