Petron confident of recovery this year

MANILA, Philippines — Petron Corp., the country’s remaining refiner, is optimistic it will reach pre-pandemic performance this year amid the continued recovery in demand.

“I would like to believe we’re much better now. We are very confident that we will soon have a better outcome than pre-pandemic,” Petron president and CEO Ramon Ang said during the company’s stockholders’ meeting yesterday.

The pre-pandemic performance will be achieved this year, Ang said in a text message when asked for further comment.

Last year, Petron’s sales volumes rose by five percent to 82.24 million barrels, which it attributed to the easing of restrictions and re-start of economic activities that improved overall demand.

“We saw promising improvements in our performance in key trades, like the 6.4 percent growth in retail volumes as mobility restriction eased,” Petron CFO Emmanuel Erana said.

CreditSights Inc.—a unit of Fitch Group.—however, said Petron’s 2021 sales volume is still 23 percent lower than pre-COVID levels. Its sales volume reached 108.5 million in 2018 and 107 million barrels in 2019.

It said another COVID variant could hinder Petron from reaching pre-pandemic sales volumes.

The Department of Health confirmed the local transmission of the Omicron subvariant BA.2.12.1, which is more transmissible than the dominant BA.2 dominant Omicron subvariant.

So far, Petron’s consolidated sales volumes reached 25.67 million barrels—a 34 percent growth year-on-year—due to higher demand. and the easing of mobility restrictions.

This nearly matches the first quarter sales volume of 26.558 million barrels in 2018, 26.343 million barrels in 2019, and 26.3 million barrels in 2020—with COVID-19 lockdown beginning March 15, 2020.

Ang said the company would continue its strategic investments in service station expansion, refinery enhancements, and supply chain management.

“Riding on the momentum we’ve built, we will continue to strengthen our market leadership, improve efficiencies, and take on projects that will ensure the sustainability of our business and operating model over the long term,” he said.

Supporting Petron’s growth this year will be supported by the completion of its new and more efficient 184-megawatt (MW) refinery Solid Fuel Fired Boiler (RSFFB) Phase 3 power plant in its Bataan refinery, which is nearing completion.

The project includes the 2x200 tph circulating fluidized boiler and 2x22-MW Backpressure Turbine Generator, and the 500-meter fuel transfer line to SL Harbor Bulk Terminal Corp.

This is one of the first power plants in the Philippines to use clean coal technology such as the circulating fluidized bed, which reduces emissions by roughly 95 percent compared to normal coal plants.

“The new power plant will do away with the use of fuel oil, allowing the conversion of this feedstock into higher-value fuels. We expect the plant to be operational by the second half of 2022 following testing, synchronization, and pre- commissioning activities,” Ang said.