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Cebu solon rejects business tycoon Ramon Ang's offer to sell Petron back to government
Cebu solon rejects business tycoon Ramon Ang's offer to sell Petron back to government
House Assistant Majority Leader and Cebu Representative Eduardo Gullas on Friday rejected the offer of San Miguel Corporation chief executive Ramon Ang to sell Petron Corp. back to the government through a five-year installment payment scheme.
"Thanks, but no thanks. Business tycoon Ramon Ang can keep Petron Corporation as Congress would never bankroll a government takeover of the country’s only oil refiner," Gullas said in a press statement on Friday, Nov. 12.
“We, in Congress, won’t allow the government to buy Petron back for the same reason that we won’t allow the state-run Philippine National Oil Company (PNOC) to acquire Shell B.V.’s 45 percent operating stake in the Malampaya gas project,” Gullas added.
Gullas had also rejected the government buyout of Shell’s 45 percent operating stake in the Malampaya gas project.
“The government neither has the money nor the operational flexibility to run extremely costly and inherently risky oil and gas undertakings that are best left to highly agile private corporations,” he further said.
Petron, which has an 18.6 percent share of the local petroleum market, reported a net loss of P11.4 billion last year, when the COVID-19 pandemic reduced the demand for fuel products.
The oil refining and marketing company has since recovered, reporting a net income of P5 billion from January to September this year.
“As to Malampaya, it is enough that the government is benefiting financially from the gas project without assuming any financial risks,” said Gullas, who noted that the government receives 60 percent of the net proceeds from Malampaya’s petroleum operations, with the 40 percent going to contractors.
“Actually, on top of the government’s share, PNOC also gets a portion of the money that goes to the Malampaya contractors, because PNOC has a 10 percent stake in the service contract.”
Gullas also said that the government should focus on providing public transportation like passenger and cargo railways.
“This is because sound transportation investments lower the costs of moving people and goods, improve productivity and foster long-term economic growth as well as jobs expansion,” Gullas concluded. (Melvin Sarangay)