In what appears to be a turnaround from its original stance, Petron has decided to permanently resume operations of its 180,000 barrels-per-day refinery in Limay, Bataan.
At the oil giant’s annual stockholders meeting on Tuesday, Petron President and CEO Ramon Ang said that it will not make any economic sense if the company would cease its refining operation, even as rival Shell closed its refinery in August 2020.
Ang further stressed that Petron upgraded the Bataan refinery about five years ago and that it has become very competitive.
Petron first announced that it would close the refinery in early December over what Ang called “unfair” taxation. The facility’s economic shutdown pushed through last February and was supposed to reopen in July depending if economic conditions improve by then. Before this, the refinery paused its operations last in May, which contributed to the drop in the country’s refining output last year.
The oil giant was able to secure several tax breaks since the shutdown’s announcement. Among these is the refinery’s inclusion in the Freeport Area of Bataan (FAB) in late December and the passage of Republic Act 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act in March.
Unless a hard lockdown is imposed again and the volume drops down tremendously, Ang said the refinery is a very viable business.
Petron lost Php11.4 billion last year due to the economic slowdown caused by the COVID-19 pandemic, but was able to post a Php1.73 billion profit in the first quarter.
Photo from Oil&Gas Journal/Petron.
