"We would be happy to maintain the same income we have in 2002 because the market has not been good," Shell vice president for finance Rolando Naguit said.
Shell reported a slight drop in its net income for end-2002 to P2.698 billion from the previous year’s P2.762 billion.
Despite the not-so-optimistic income growth projection, Naguit said the company will allot more capital for expansion of network and marketing this year. He said it will allocate about P2.2 billion for capital expenditure for 2003 compared to P1.7 billion.
But Naguit pointed out that they continue to study the market before they expand their network to other parts of the country.
"It depends on the economy. We have to carefully study if there is really a need to add more retail stations," he said.
He said at present they are also rationalizing their network. "We are adopting the so-called cutting the tail wherein we are closing gasoline stations that are not doing well," he said.
So far, the Shell finance chief said the company operates the most efficient network of gasoline stations in the country.
At the same time, he admitted that the company decided to reduce the rated capacity of their refinery plant in Bataan to only 85,000 barrels per day from 110,000 barrels.
"We have to bring down the running capacity of our plant to allow importation of products that are Clean Air Act (CAA) compliant," it said.
Unlike Petron Corp., Shell decided to just import blending materials to comply with the new CAA specifications.
Petron, the country’s largest oil refiner, is investing $94 million to put up isomerization and hydrotreater plants that will able to produce CAA-compliant fuel.