Even small oil players making a killing, says Gullas

MANILA, Philippines – Cebu Rep. Eduardo Gullas said records with the Securities and Exchange Commission showed that Total Philippines Corp., Seaoil Philippines Inc., Mindanao-based Phoenix Petroleum Philippines Inc., Unioil Petroleum Philippines Inc., and Filpride Energy Corp. posted considerable profits even before the start of the record increases in global crude costs.

In a statement, Gullas, head of the 12-man House contingent to the Commission on Appointments, revealed that Total reported a “net profit of P324.79 million in 2007 – a huge reversal from the P290.14-million net loss the firm posted in 2006.”

Seaoil posted a “net profit of P123.4 million in 2007.” The senior House member said this figure was “235 percent higher than the P36.84 million that the firm posted in 2006.”

Phoenix, whose operations are limited to Mindanao, declared a “net income of P122.36 million in 2007,” or “up 65 percent from the P74.26 million that it posted in 2006.”

The same is true with Unioil, which realized a net income of P35.79 million in 2007 or 78 percent higher than the P20.09 million the previous year 2006.

Filpride Energy Corp. reported a 259-percent increase in net profit, from P1.44 million in 2006 to P5.17 million in 2007, Gullas said.

“Only Eastern Petroleum Corp. reported a slight net profit decline, from P8.57 million in 2006 to P7.18 million in 2007,” the administration lawmaker said.

The independent oil firms, Gullas said, corner around 15 percent of the local market for petroleum products. Shell, Petron and Chevron (formerly Caltex) dominate the market.

Records showed that Shell, along with Petron, has earned a staggering P70 billion in net profits since 1998, a year after the first deregulation law was struck down by the Supreme Court for being unconstitutional, prompting Congress to enact a new law.

Gullas is the author of House Resolution 672, urging the House committee on energy “to investigate and report the facts relating to any oil price manipulation or similar abuses committed by any person or corporation.”

Reps. Exequiel Javier of Antique and Alvin Sandoval of Malabon-Navotas earlier said the country’s biggest oil firms should be haled to court if an audit being conducted by the Department of Energy proves there has been “overpricing” of petroleum products.

“They (oil companies) must be punished to the fullest extent of the law if it is proven they were bleeding the people dry,” Javier, chairman of the House committee on ways and means, said.

He said it is “high time for oil firms to be closely scrutinized.”

“Since time immemorial, the reason they give for raising fuel prices is that they are losing. Through the audit, we will finally know whether or not they are lying.”

Sandoval said the DOE audit may “unmask the oil companies for what they really are.”

“We hope to determine the profits they accumulated after years of increasing oil prices without regard to the plight of the people,” he said.

Sandoval also said the audit results may be used as basis whether to repeal the Oil Deregulation Law.

“The Oil Deregulation Law was enacted precisely to encourage competition among industry players to cause the reduction of prices of oil and petroleum products,” he said. 

“If it cannot serve its purpose, then the law is useless and must be repealed, the sooner the better for our people,” he said.