House Assistant Majority Leader and Cebu Rep. Eduardo Gullas on Friday said the government neither has the money nor the operational flexibility to run Petron and Malampaya gas project.
Gullas made the statement following calls for the government to buy back Petron, the only oil refiner in the country, and Shell’s 45% stake in Malampaya gas project.
“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 Co. to acquire Shell B.V.’s 45 percent operating stake in the Malampaya gas project,” Gullas said.
Business tycoon Ramon S. Ang earlier said that he is willing to sell back Petron to the government.
“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,” Gullas added.
Petron, which has an 18.6% share of the local petroleum market, reported a net loss of P11.4 billion in 2020. From January to September this year, Petron reported a P5 billion net income.
“As to Malampaya, it is enough that the government is benefitting financially from the gas project without assuming any financial risks,” Gullas pointed out.
Gullas said the government receives 60% net proceeds from Malampaya’s petroleum operations, with the 40% going to the 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 explained.
Gullas said the only business that the State should go into now is the business of providing public transportation, particularly 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 added.