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Thursday, March 28, 2024

DOE reviewing PNOC’s proposed strategic petroleum reserve

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Energy Secretary Raphael Lotilla said Wednesday he is reviewing the work plan and projects of state-run Philippine National Oil Co. such as the proposed strategic petroleum reserve.

“We are reviewing their work plan and projects so that they can concentrate on some alternatives fuel. For example, we don’t compete with private sector,” Lotilla said.

PNOC was created through Presidential Decree No. 334 on Nov. 9, 1973 to provide and maintain an adequate and stable supply of oil. PNOC’s charter was later amended to include energy exploration and development.

The company posted a comprehensive income of P3.363 billion in 2022, up from P1.092 billion in 2021. Revenues reached P6.37 billion from the sale of the banked gas, lease and operation of the energy supply base and its industrial park.

Lotilla said the PNOC’s SPR program is still part of the government’s oil emergency plan.

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“But if you continue to invest in the oil strategic reserve right now, and what you have is a declining market for oil so you will have to take a look at how long will be the useful life of your investment. It is something that involves cost…These are the things that we are considering,” he said.

PNOC put on hold its proposed SPR and targeted fuel relief program initiatives, pending a policy and financial review.

“Oil is a sunset industry and considering this, the SPR and TFRP shall be subjected to policy and financial viability review,” PNOC said in its 2022 yearend report.

The SPR consists of large stockpiles of crude oil and petroleum products stored in facilities located around the country—and possibly overseas—that are released during periods of local or international oil supply disruptions.

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