The budget of the Philippine National Oil Company (PNOC) has been reduced by P2.5 billion for 2023 as part of efforts to compel the government-owned and controlled corporation (GOCC) to refocus its mandate into providing stable and secure supply of oil, including the exploration of oil and gas.
The reduction was made by the Senate Committee on Finance Sub-Committee E chaired by Senator Sherwin Gatchalian during deliberations of the proposed P5.268-trillion national budget for 2023 on the Senate floor.
The P2.5-billion reduction in PNOC’s budget was originally meant for its Targeted Fuel Relief Program (TFRP) and its strategic petroleum reserve (SPR) program.
However, Gatchalian said that the fuel relief program is a duplication of the government’s Pantawid Pasada program and that the SPR program is yet to hurdle feasibility issues and could take billions of pesos to implement.
“The original mandate of PNOC is to provide a stable and secure supply of oil, including exploring oil and gas. But some of the projects being implemented now by PNOC are not aligned with its original mandate, such as the fuel relief program. Some of these projects too lack feasibility studies and won’t help the government achieve energy security,” he emphasized.
Serving as the vice-chairman of the Senate Committee on Energy, Gatchalian earlier called on the Department of Energy (DOE) to put the PNOC in order and set guidance for the company, noting that PNOC and its subsidiaries have failed in upholding their original mandate.
“PNOC is the government’s vehicle to locate oil and gas fields but as we all know, there is only one major oil and gas find and that is Malampaya,” he noted.
To help PNOC refocus its operations towards its original mandate, Gatchalian has filed a bill seeking to establish a national policy and framework for petroleum exploration and development in the country by amending the PNOC charter.
He emphasized that the end goal of Senate Bill 380, which gives PNOC an exclusive mandate to undertake oil and gas exploration and development programs, is to reduce the country’s dependence on oil imports amid high level of petroleum prices, driving inflation rate at record levels and dampening economic growth.