Paris-headquartered multinational TotalEnergies is making full-scale retreat from its energy businesses in the Philippines, primarily from its venture in the downstream oil industry, a highly placed source has disclosed to Manila Bulletin.
An industry insider with direct knowledge on the matter similarly indicated that TotalEnergies won’t just do a partial retreat, “but the exit will cover all businesses, that’s the information so far that was relayed to employees in the Philippines.”
After more than 25 years of business presence in the country, TotalEnergies is poised to become the first major foreign player to break ranks—pulling out of an investment arena it once helped shape following the industry’s deregulation in 1998.
The source added that “it will be a sweeping departure; and somehow, we already feel that the Philippine office had been practically abandoned, that we are not even included anymore in the anniversary celebration of Total this year.”
READ: TotalEnergies assures continued Philippine operations after fuel business sale
The source further confirmed that TotalEnergies has already fully offloaded its downstream oil business to Filoil Philippines Corp. of businessman Raffy Villavicencio—cementing the earlier reported deal between the two companies; and that somehow marks the end of an era as the French giant handed over the reins to the Filipino company following its exit from the scene.
“Filoil already had its takeover in January this year, although it was not formally announced to TotalEnergies executives and employees when the closing of the transaction happened,” the source stressed.
Prior to the full acquisition of Total’s oil business, the Villavicencio-led company already had a joint venture arrangement with the French energy giant since 2016.
And while TotalEnergies chose to quietly slip out of the Philippine market without a formal announcement, it was one of the few bold voices to publicly condemn the country’s deeply politicized oil industry; and it also tirelessly raised red flags over rampant smuggling that distorted competition and left the sector ripe for exploitation.
Apart from its pullback from the downstream oil market, it was further hinted that TotalEnergies would likewise be scrapping its earlier plans to inject capital into the Philippines’ renewable energy (RE) sector, which should have served as its diversification venture in the domestic energy landscape.
Just over two years ago, TotalEnergies had announced its partnership with Japanese firm ENEOS to develop two gigawatts (GW) of decentralized solar capacity across Asia; yet now, that ambition of fresh capital infusion may no longer be concretized for the Philippine market in particular.
Previously, Total was also an interest-holder in Service Contract 56 at the Sulu Sea basin, but it similarly walked away from that undertaking after establishing “non-commerciality” of the scale of reserves at its petroleum exploration prospect.
In 2012, TotalEnergies acquired the Sulu Sea basin block through a farm-in deal with Exxon Mobil, which was the first to cut ties with the area after its four-well drilling campaign revealed a devastating “suboptimal yield”—a cautionary investment account that just proved too costly for both oil giants.