Petron Corp.’s net income for the full year may reach P18 billion, bulk of which is expected to come from its Malaysian operations.
“Including Malaysia this year, easily it will reach P18 billion. Malaysia will deliver P12 billion because during the first half it’s income was already P6.4 billion. For the Philippines, it could be P6 billion,” Petron President Ramon S. Ang said last week. In January to June, Petron’s net income doubled to P7.7 billion from P3.87 billion in the same period last year, driven by a double-digit sales growth as demand continues to pick up.
Bulk of Petron’s first-half earnings came from Malaysia. When asked why Petron Malaysia’s performance is stronger that in the Philippines, Ang said “it’s because it is subsidized in Malaysia but fuel prices here are going up because we are not allowed to pass on.”
The company’s Philippine and Malaysian operations, including its trading subsidiary in Singapore, sold a total of 51.4 million barrels during the first half, up 34 percent from 2021’s 38.5 million barrels. Sales volume improved across all trades with Petron’s commercial sales posting the highest increase as more industries, including aviation travel, rebounded from the pandemic’s impact. Petron is the only refiner in the country, supplying about 40 percent of the country’s oil requirements.
It reported that it benefited from the strong regional refining margins with higher production at its Bataan Refinery in Limay, Bataan.
“Before, for every barrel, we can only recover 67 percent. The 33 percent is residue. Now, we can process 96 percent crude oil. Before, income per barrel is $1. Now, since the recovery is better, the income per barrel is doing $4.
We installed a cocker and we put a new steam producer. So, we are not relying on oil to produce steam. The remaining four percent is petroleum coke that is being used to fuel the steam, that’s why it’s integrated now. No more residue,” said Ang.
Petron is building new power plant facilities in the refinery, which will replace some of its old generators, increase steam production, and expand power generation capacity from 140MW to 184MW.
This is part of Petron’s planned capital expenditure projects to ensure reliability and efficiency of critical refinery process. Other projects include putting up more retail service stations, expand its retail network of its LPG, lubes and non-fuel segment, upgrade its logistics capacity, and expand its Malaysia operations with new service stations and facilities improvement in the Port Dickson refinery and terminals.