The monetary resilience of Pilipinas Shell Petroleum Corp. amid the demanding adjustments and situations faced by the global refining industry and the transition to a new one caused by the coronavirus pandemic (COVID-19).
After the closure of crude oil processing activities on the site, Pilipinas Shell will turn the Tabangao refinery into an import terminal to optimize the company’s asset portfolio and prices and the competitiveness of its home chain, the company said.
“We have the technical capacity and monetary flexibility to manage and adapt to disruptive conditions. Regional refining margins, which have long been low by the imbalance between oil and demand in the region, have been exacerbated by the destruction of Call for the Crisis [COVID-19]. As such, the operation of the refinery is no longer economically feasible for us. It is with a heavy center that we announce the closure of oil refining activities in Tabangao,” César Romero said. , President and CEO of Pilipinas Shell.
Romero reiterated that the completion of processing operations in Tabangao would not affect Pilipinas Shell’s ability to obtain high-quality fuels, as the operator changed its production source chain strategy to import-based operations.
Pilipinas Shell stated that the Tabangao refinery and import terminal will continue to meet the fuel wishes of Luzon and northern Visayas, while the Northern Mindanao Import Facility (NMIF) in Cagayan de Oro will meet the desires for developing energy in the balance of Visayas and Mindanao. Regions.
“Shell remains committed to the Philippines and will look for opportunities where we can leverage our expertise in line with our expansion strategy,” Romero said.
Pilipinas Shell said it has been consistently supplying products to consumers since the Tabangao refinery halted crude oil processing operations on May 24 as a cash-saving measure that fuel relief demands as a component of the country’s enhanced quarantine network to combat the spread of COVID-19. (OGJ Online May 6, 2020).
According to Kagawaran ng Enerhiya, the Philippines Ministry of Energy, the country’s call for oil products to impose improved quarantine on the grid fell from 20 to 30% in March and 60 to 70% in April compared to February levels, Pilipinas Shell said. .
Regional demand for petroleum products has not yet returned to general levels, with many corporations still suspended or operating below capacity, although it remains limited due to varying degrees of national quarantine restrictions.
Pilipinas Shell said it expects a drop in call for now that the metropolitan domain of Manila and major cities and provinces are returning to the improved modified quarantine network, or MECQ.
In addition, refining margins, which were drastically reduced at the beginning of the year, fell further and could remain depressed in the medium term, according to the operator.
Other key points on the scope and timing of the Tabangao refinery conversion allocation have yet been published.
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