Petron accepts compromise formula, is ready for OilEx - Federico

WE had wanted to be proved wrong, but our prediction has come true that those Abu Sayyaf terrorists reportedly trapped in their mountain lair on Basilan island would slip, again, through the vaunted military cordon.

Way back on April 25, Postscript stuck its head out and headlined "Coming soon: The Great Escape of Abu Sayyaf!" And, as we predicted, that was exactly what has just happened.

After fierce, bunker-to-bunker fighting (as the military had put it), the retreating terrorists were finally cornered inside a cave. Fearful that a trap lay in wait inside, the pursuing troops decided to flush out the enemy by tear gas.

But when the smoke dissipated, lo and behold, there were no Abu Sayyaf, no hostages, and no clue to lead the pursuing troops.

It could have been a great movie, except that we've heard that wornout "slipped through the military cordon" story countless times before. (Yawn)

NO, we're not gloating over the failure of the military to capture the Abu Sayyaf gang and recover their hostages.

We sympathize with our fighting men, handicapped as they are by insufficient logistics and armaments. There is a limit to what the best of men could do.

If only they considered our suggestion for a partial news blackout, they would not have gone through the routine of producing a daily update and saying at one point that they had the terrorists cornered.

A military spokesman even had to appear on TV explaining a battle map showing where they think the enemy was and where their own troops were deployed to block any escape attempt. What a "transparent" way to conduct a war!

THERE'S clearly a need to rethink everything, especially the way we handle hostage and terrorism situations. We definitely have to train, equip and maintain a special force for such recurring emergencies.

But such a review or study should not be conducted by the usual congressional committee.

We have inflicted upon ourselves enough damage in the eyes of the watching world. Let's not aggravate it by allowing politicians to stick their fingers into it.

YOU know how it is. Take, for instance, this first-time senator who is more concerned about his costume (sartorial elegance to him, but form-over-substance to us) when he spouts inanities just to land in the media.

In the thick of the Urban Bank fiasco, there he was demanding that the return of at least half of each deposit be guaranteed when a bank collapses. That's as pro-forma as saying that we should fight crime, produce more food and look after our children.

Earlier, he gained publicity by lambasting shopping mall operators for charging parking fees. He gave his compañero bit of legal advice, saying that the charging of parking fees was a clear violation of law.

Did he file the proper charges? No. Has he caused the passing of a law clamping down on exorbitant parking fees? No. Why should he nga naman, when he has had the publicity he wanted?

SOMETHING more exciting is stirring on the oil and fuel front.

Petron Corp., the biggest (37 percent market share) oil company in the country weighed in yesterday in favor of the Postscript compromise formula that would see the oil giants and the National Oil Exchange proposed by Rep. Enrique Garcia slugging it out in the deregulated market.

Chairman Jose A. Syjuco Jr. of Petron told us in an e-mail: "We in Petron have always supported the deregulation of the oil industry. For this reason, we have no objections to your proposed compromise whereby the OilEx will operate as a major trader of finished petroleum products for distribution within the country."

But Syjuco added: "Provided (1) the OilEx can secure the funds for its operation, (2) the existing oil companies are not forced to buy their supplies through it, and (3) the OilEx will not enjoy government subsidies and thus compete on equal terms with the other oil companies."

FOR those who just came in, the compromise formula that we have proposed is basically this:

* The oil firms will keep their refineries, storage facilities and gas stations to retail their branded products. They can join the international bidding to be called by the National Oil Exchange, but will not be required to buy refined products from the OilEx.

* Operating parallel to them, the National Oil Exchange proposed by Garcia will buy gasoline, diesel and other petroleum products directly from the lowest bidder anywhere in the world. The OilEx will store its supply initially in the Subic-Clark depots left by the Americans, and compete with the Big 3.

IN his e-mail, Syjuco also clarified that when he testified recently in a congressional hearing he did not make a statement in an "unguarded moment" that the OilEx would bring down prices of petroleum products.

"The truth is that I have always said that the OilEx will actually raise prices," the Petron chief executive said. "(The OilEx) will only be an additional step in the supply chain, whose costs will have to be recovered from the consumers."

WE put forward the compromise formula because we were afraid that the scattered debates over deregulation and the OilEx have dragged on too long, while consumers continue to suffer under unsettling fuel price fluctuations.

We hoped that a compromise could lead to mutual accommodation between the oil companies and Garcia and cut short the debate. Of course the formula still needs refinements, but details could be fleshed out after an agreement in principle, if any, emerges.

Neither Garcia nor the Big 3 can win them all. But a compromise will enable both camps to win something for themselves while serving the public.

With at least Petron saying it has "no objections" to the compromise, under certain conditions, we hope to hear soon from congressman Garcia as well as Shell, Caltex and other players.

AS of noon yesterday, 47 percent of respondent-readers have agreed with our proposed compromise, with 7 percent disagreeing.

But what we found more significant is that almost half (46 percent) of the respondents neither agreed nor disagreed with our formula. Instead, they commented on Garcia's OilEx proposal and took a pro/con position on it.

One out of every three (33 percent) of respondents supported the OilEx, looking forward to its establishment and deploring the stranglehold of the Big 3 on the fuel market.

Some 13 percent, however, criticized the OilEx idea as not workable.

WHEN we weigh the comments of those who agreed with our compromise formula and those who supported Garcia's OilEx, our preliminary qualitative conclusion is that a great majority (around 80 percent) of respondents want a liberation from the Big 3 cartel.

But while they object to high fuel prices and their arbitrary fluctuation, complaining consumers are not unanimous on how exactly prices could be tempered to reasonable levels.

The 47 percent who agreed with our compromise formula are presumed to regard it as one route toward lower prices. While they are willing (or resigned) to see the Big 3 still operating their refineries, depots and retail stations, they also want the OilEx operating as a countervailing force.

ABOVE the scene, we see President Estrada -- despite his claim that he cares for the poor masses -- unwilling to confront and cut down the oil ogre. He does not appear ready to earn the ire of the powerful cartel and that of their global allies.

His guts may tell him that the OilEx idea can provide solutions to many price problems and that it enjoys popular support, but the President has been effectively isolated and rendered unable to enforce his will.

One dampener to the OilEx idea is its still raw configuration as described in House Bill 8710 filed by Garcia. While it may have a solid kernel, the concept still needs substantial amendments and polishing.

In fact, the details of the bill in its continually changing editions are not that clear even to those who support it. The bill, including amendments informally accepted by its author, should be presented again in a clean and clear form for a more intelligent discussion.

POSTSCRIPT reader RK using a readrite address says, "the idea looks good, though I admit I am still ignorant of some of the details of this Oil Exchange." He asks: "How will the Oil Exchange send its products to the consumers? Will it be through the existing gas stations? What if the gas station owners are pressured by the oil companies to buy only their products?"

Ernesto A. Rivera of Iloilo City says "the OilEx is good . . . four players can co-exist." But he foresees problems: "There should be storage for at least 30 days' stock, as well as tanker trucks, tanker ships, and distribution facilities in every province and in the cities owned by private individuals."

A doctor, Rivera remarks: "The prime problem is the cheap source of oil. Generics (pertaining to medicines -- fdp) failed because of lack of control of raw materials from abroad."

We will try to find space in succeeding columns for the many others who sent comments with substance.

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