Petron can fill up gas lack in Metro Manila

FEAR NOT: The forced closure of the leaking 117-kilometer pipeline through which fuel is moved in big volumes from Batangas to Manila is not likely to cause a gas shortage or an abnormal price increase in the national capital, industry sources say.

Shell and Chevron (Caltex), whose refinery or facilities are in Batangas, use the pipeline owned by the First Philippine Industrial Corp. Only these two firms are affected by the indefinite interruption of the pipeline service.

Petron Corp., the biggest industry player, does not use that line. Since its refinery is in Limay, Bataan, it just barges its finished products across Manila Bay, up the Pasig River, to its Pandacan depot. For delivery overland to other places in Luzon, it uses lorries and tankers.

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BIGGEST PLAYER: Petron controls 50 percent of the Metro Manila market, which uses 13-15 million liters daily. Figures I have seen show that Shell and Chevron account for 40 percent of sales and the small players share the balance of 10 percent.

The Bataan refinery is rated to refine 180,000 barrels (equivalent to 28,617,120 liters) of crude oil per day, making it the largest integrated refinery in the country. Petron says it has enough supply to keep pump prices relatively steady.

The primary determinants of local fuel price adjustments are the changes in finished products based on Mean of Platts Singapore (MOPS) and the peso-dollar exchange rate. Prices are also driven by market forces.

Petron gives assurance that it has the capacity to increase the volume of its delivery if necessary. I heard it is already helping other oil firms affected by the pipeline closure meet the requirements of their customers.

No wonder the Department of Energy confidently says that the pipeline’s closure, which was ordered by the court (after it was already shut down), will not cause a supply crisis in Metro Manila.

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COMMON FUEL: We used to have in the Philippines only one kind of diesel for all diesel-fueled vehicles. An owner of a luxury BMW or Mercedes-Benz, for instance, would load the same messy diesel used by jeepneys, trucks and buses.

I would ask experts if loading that common diesel was not bad, since it was grimy and emitted so much smoke, especially with its mix of coconut oil or some concoction. Being subsidized, diesel is cheaper, but what does it do to the engine?

It puzzled me why the oil companies did not produce two kinds of diesel, one for public utility vehicles and another, a refined diesel, for the more sophisticated engines.

If gasoline has an octane-rating, diesel has a Cetane Number (CN) which rates the combustion quality of the fuel during compression ignition. It is a significant expression of its fuel quality, among a number of other measurements.

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PROMO ENDS: Then one day Shell came up with its V-Power Diesel that it claimed was superior (but cost about P2 more per liter). That seemed to have answered my question, and I immediately switched to it to experience the advertised power.

I got stuck to it after Shell and its billing partner-bank cooked up a promo of giving a P100 straight discount on any gas bill that is at least P1,500 and paid with a specified credit card.

When the promo period ended, however, it was goodbye to the P100 discount. This was followed by the closure of the pipeline delivery of Shell from Batangas and that meant goodbye to its V-Power Diesel.

That also meant my going back to regular diesel, lining up again with the jeepneys and other utility vehicles. And since I look for “super” or “power” diesel, I now go to Petron stations whose supply never ran out.

(For the curious — somebody is bound to ask anyway — the 2.0-liter diesel engine of my SUV gives me 9 kilometers to the liter in the city and 14 kms on the highway. Even at high speed, my tachometer hardly goes beyond 1,500 revolutions per minute. Its comparatively small German-made engine packs a maximum 177 horsepower.)

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BDZ REJOINDER: My Postscript on the cancellation by President Aquino of the P18.7-billion contract of a Belgian company for the dredging and rehabilitation of Laguna Lake elicited a rejoinder from the firm:

“It is malicious for any Palace official to accuse Baggerwerken Decloedt En Zoon of ‘misleading’ former DENR Secretary Eleazar Quinto and the National Economic and Development Authority on the supersubsidy since ONDD had already affirmed that it is guaranteeing the loan issued by the Fortis-Paribas.

“The letter of the Belgian embassy to former DENR Secretary Horacio Ramos dated June 10, 2010, affirmed that ONDD has the guarantee of the Belgian government and that this agency had been facilitating such loans for more than 60 years.

“This letter supersedes an earlier letter often cited to prove that the Belgian government had not issued any guarantee to the project and is thus superior to any previous communication quoted to back up allegations that the Philippine government would be swamped with huge payments for principal and interest due to a commercial loan extended to the project.

“Moreover, the Department of Justice had issued three opinions which found no basis to claim that the project is irregular since it is covered by the Official Development Assistance Act. Neither does it violate the Government Procurement Law and the purported mandatory bidding requirement for such projects.

“The three DOJ opinions were issued in response to the issue of the legality of the contract, the absence of bidding and whether the contract is an executive agreement or not. In all three issues, the assailed contract was deemed valid by DOJ.”

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