Petron Corporation
Encyclopedia
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
, supplying more than a third of the country’s oil requirements.
Petron operates a refinery in Limay, Bataan
Limay, Bataan
Limay is a 1st class municipality in the province of Bataan, Philippines. According to the latest census, it has a population of 54,782 people in 9,490 households.-Barangays:Limay is politically subdivided into 12 barangays.* Alangan* Kitang I...
, with a rated capacity of 180000 oilbbl/d. From the refinery, Petron moves their products mainly by sea to 32 depots and terminals in the country. They operate a state-of-the-art lube oil blending plant at their Pandacan Terminal, where it manufactures lubes and greases.
Petron is publicly-listed. Up until recently, the Philippine National Oil Company
Philippine National Oil Company
Philippines National Oil Company, owners of 40% stake in Petron, is a Philippines state owned company.On April 25 2008, Gloria Macapagal-Arroyo appointed former Negros Oriental 1st district congressman Jacinto "Jing" Paras as chairman of its subsidiary, the Philippine National Oil Company -...
(PNOC) and the Aramco Overseas Company B.V.
Saudi Aramco
Saudi Aramco , officially the Saudi Arabian Oil Company, is the national oil company of Saudi Arabia.Saudi Aramco is the world's largest and most valuable privately-held company, with estimates of its value in 2011 to be $7 trillion USD.Saudi Aramco has both the largest proven crude oil reserves,...
each owns a 40% share of equity, with the remaining 20% is held by close to 190,000 individual stockholders. In 2008, Saudi Aramco
Saudi Aramco
Saudi Aramco , officially the Saudi Arabian Oil Company, is the national oil company of Saudi Arabia.Saudi Aramco is the world's largest and most valuable privately-held company, with estimates of its value in 2011 to be $7 trillion USD.Saudi Aramco has both the largest proven crude oil reserves,...
sold its entire stake to London-listed investment group Ashmore Group
Ashmore Group
Ashmore Group plc is a large British investment manager dedicated to the emerging markets. Established in 1992, the company is a constituent of the FTSE 100 Index. The Chairman is Michael Benson and the Chief Executive is Mark Coombs. It is headquartered in London.-Senior management:-External...
, through SEA Refinery Holdings BV. Then SEA added 11 percent more stake in Petron when Ashmore made a required tender offer to other shareholders, for a total 51 percent stake.
In December 2008, Ashmore acquired PNOC's 40 percent stake in Petron. It subsequently sold its 51 percent stake to local food and beverage giant San Miguel Corporation (SMC). Ashmore retains 40 percent. The remaining shares—about 9 percent—are held by the public.
History
Petron's history dates back to September 7, 1933 when the Socony Vacuum Oil Company of New York and the Standard Oil Company of New Jersey formed the Standard Vacuum Oil Company (Stanvac). The end of the venture in the early 1960s split the marketing and refining interests of the company between Esso and Mobil.In 1953 the government, partly to promote Claro M. Recto
Claro M. Recto
Claro Mayo Recto, Jr. , was a Filipino politician, jurist, poet and one of the foremost statesmen of his generation...
's national industrialization programme and partly to respond to increasing international oil prices, attempted to launch a national oil company that caters Filipino consumers with cheap oil. Thus, FilOil, the first Philippine oil company was established.
In 1973, Esso
Esso
Esso is an international trade name for ExxonMobil and its related companies. Pronounced , it is derived from the initials of the pre-1911 Standard Oil, and as such became the focus of much litigation and regulatory restriction in the United States. In 1972, it was largely replaced in the U.S. by...
sold its business to the government which became the Philippine National Oil Company
Philippine National Oil Company
Philippines National Oil Company, owners of 40% stake in Petron, is a Philippines state owned company.On April 25 2008, Gloria Macapagal-Arroyo appointed former Negros Oriental 1st district congressman Jacinto "Jing" Paras as chairman of its subsidiary, the Philippine National Oil Company -...
(or PNOC). Subsequently, Mobil
Mobil
Mobil, previously known as the Socony-Vacuum Oil Company, was a major American oil company which merged with Exxon in 1999 to form ExxonMobil. Today Mobil continues as a major brand name within the combined company, as well as still being a gas station sometimes paired with their own store or On...
also sold its share of the refinery to PNOC.
The oil refining and marketing units in PNOC, along with FilOil, were eventually merged to form Petrophil, which was later renamed as Petron. Today the company's industrial earnings have never seen such high gains but still trade within the average global yield. Presently, CEO Ross Arroyo leads the 18th-ranked Philippine Oil Co. within the Eastern Hemisphere.
As part of the government's privatization program, PNOC sought a strategic partner that would give Petron a reliable supply of oil, plus access to state-of-the-art refining technology. The result was a partnership with the world's largest oil producer, Saudi Aramco.
On February 3, 1994, PNOC and Aramco Overseas Company BV signed a share purchase agreement that gave both a 40% stake in Petron. The remaining 20% of Petron shares were sold to the public.
On August 11, 2006, Petron responded to the biggest oil spill
Oil spill
An oil spill is the release of a liquid petroleum hydrocarbon into the environment, especially marine areas, due to human activity, and is a form of pollution. The term is mostly used to describe marine oil spills, where oil is released into the ocean or coastal waters...
in the Philippines as a tanker
Tanker (ship)
A tanker is a ship designed to transport liquids in bulk. Major types of tankship include the oil tanker, the chemical tanker, and the liquefied natural gas carrier.-Background:...
(Solar 1) carrying fuel oil
Fuel oil
Fuel oil is a fraction obtained from petroleum distillation, either as a distillate or a residue. Broadly speaking, fuel oil is any liquid petroleum product that is burned in a furnace or boiler for the generation of heat or used in an engine for the generation of power, except oils having a flash...
sank in Southern Guimaras. The company took the moral and social responsibility and immediately spearheaded a massive clean-up and relief operation. In less than three months, the shores of Guimaras were cleaned. At present, Petron has built a school and a Library Hub on the island and has rolled out several livelihood (seaweed farming
Seaweed farming
Seaweed farming is the practice of cultivating and harvesting seaweed. In its most simple form, it consists of the management of naturally found batches...
, mariculture farming, etc.) programs on the island.
On July, 2008, Petron Corp. said London-listed investment group Ashmore Group, through SEA Refinery Holdings BV, had acquired 50.57 percent of its stock. Ashmore's payment was made on December, 2008.
On December, 2008, San Miguel Corporation
San Miguel Corporation
Established in 1890 as a brewery, San Miguel Corporation is Southeast Asia's largest publicly listed food, beverage and packaging company with over 17,000 employees in over 100 major facilities throughout the Asia-Pacific....
said it was in the final stages of negotiations with British investment fund Ashmore Group for an option to buy up to 50.1 percent of the latter’s stake in oil giant Petron Corp.
Products and services
The company's ISO-14001-certified refinery processes crude oil into a full range of petroleum products, including LPG, gasoline, diesel, jet fuelJet fuel
Jet fuel is a type of aviation fuel designed for use in aircraft powered by gas-turbine engines. It is clear to straw-colored in appearance. The most commonly used fuels for commercial aviation are Jet A and Jet A-1 which are produced to a standardized international specification...
, kerosene
Kerosene
Kerosene, sometimes spelled kerosine in scientific and industrial usage, also known as paraffin or paraffin oil in the United Kingdom, Hong Kong, Ireland and South Africa, is a combustible hydrocarbon liquid. The name is derived from Greek keros...
, industrial fuel oil, solvents, asphalts and mixed xylene
Xylene
Xylene encompasses three isomers of dimethylbenzene. The isomers are distinguished by the designations ortho- , meta- , and para- , which specify to which carbon atoms the two methyl groups are attached...
.
With their ISO-9000/2000-certified lube oil blending plant, they are also able to produce mechanical lubricants and grease. These products are also sold through service stations and sales centers, and directly to industrial customers.
Through their nationwide network, they supply fuel oil, diesel, and LPG to various industrial customers. Petron's largest client is in the power sector.
They also supply jet fuel at key airports to international and domestic carriers.
Through more than 1,200 service stations, they retail gasoline, diesel and kerosene to motorists and public transport operators. They also sell their LPG brand Gasul to households and other consumers through an extensive dealership network.
Petron is expanding to non-fuels businesses which include convenience store brand “Treats.” They have partnered with major fast-food chains, coffee shops, and other consumer services to give customers a one-stop full service experience. They are also putting up additional company-owned and operated service stations in strategic locations.
Petron also opened its first fuel additives blending plant in the Asia-Pacific region at the Subic Bay Freeport Zone
Subic Bay Freeport Zone
Subic Bay Freeport Zone , which is known simply as Subic Bay, is the Philippines' first success case of a into a tax- and duty-free zone similar to Hong Kong and Singapore, operated and managed by the Subic Bay Metropolitan Authority or SBMA. It covers the fenced area of the former U.S...
in November 2008.
The plant has the capacity to blend 12,000 metric tons (MT) of fuel additives per year. When used in gasoline
Gasoline
Gasoline , or petrol , is a toxic, translucent, petroleum-derived liquid that is primarily used as a fuel in internal combustion engines. It consists mostly of organic compounds obtained by the fractional distillation of petroleum, enhanced with a variety of additives. Some gasolines also contain...
, diesel, or fuel oil
Fuel oil
Fuel oil is a fraction obtained from petroleum distillation, either as a distillate or a residue. Broadly speaking, fuel oil is any liquid petroleum product that is burned in a furnace or boiler for the generation of heat or used in an engine for the generation of power, except oils having a flash...
, fuel additives improve efficiency, boost engine performance, and benefit the environment by reducing harmful emissions.
The facility was constructed in partnership with Innospec
Innospec
Innospec Specialty Chemicals is the world's only manufacturer of tetraethyllead used in the manufacture of 100LL avgas. It is listed on the NASDAQ as IOSP.-Controversy:...
, a leading global fuel additives supplier, based on an agreement forged in 2006. As part of the agreement, Petron constructed and operated the plant to serve the requirements of Innospec’s customers in the region, including Petron.
Traditionally, Innospec products used in Asia have been sourced from Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
.
Petron and Innospec have been fuel-technology partners since 1995, producing premium fuel products. Beyond this partnership, Innospec said it chose Petron for its strong technical capability in blending and quality control, customer service and proven integrity when it comes to safeguarding Innospec’s proprietary formulations.
In April 2008, Petron also commissioned the country’s first petrochemical
Petrochemical
Petrochemicals are chemical products derived from petroleum. Some chemical compounds made from petroleum are also obtained from other fossil fuels, such as coal or natural gas, or renewable sources such as corn or sugar cane....
feedstock units, namely, the Petro Fluidized Catalytic Cracking (PetroFCC) unit and a Propylene Recovery Unit (PRU) at its 180000 barrels (28,617.7 m³)-per-day Bataan
Bataan
Bataan is a province of the Philippines occupying the whole of the Bataan Peninsula on Luzon. The province is part of the Central Luzon region. The capital of Bataan is Balanga City and it is bordered by the provinces of Zambales and Pampanga to the north...
refinery.
The PetroFCC, the first “cracking” unit of its kind in the world, converts black products (fuel oil) into higher-value LPG, gasoline, and diesel, and yields a higher level of the petrochemical feedstock propylene than typical FCC units.
The PRU further purifies the propylene so that it can be used in making various petrochemical products that are used to manufacture everyday items such as food packaging, appliances, suitcases, furniture, DVDs and even car parts.
Headquarters
Located at the heart of Buendia Avenue in Makati CityMakati City
The City of Makati is one of the 17 cities that make up Metro Manila, one of the most populous metropolitan areas in the world. Makati is the financial center of the Philippines and one of the major financial, commercial and economic hubs in Asia...
, the company's headquarters, the Petron Megaplaza
Petron Megaplaza
The Petron Megaplaza is an office skyscraper located in Makati City, Philippines. It previously held the title as the tallest building in the Philippines from 1998-2000, when the current tallest building, the PBCom Tower, was topped-off. It currently holds the title as the third tallest building in...
, is a 45-storey building with floor plate area of about 15,512 square meters, which was the Philippines' tallest building before being topped by the PBCom Tower
PBCOM Tower
The Philippine Bank of Communications Tower, more commonly known as PBCom Tower, is an office skyscraper that currently holds the title, since 2000, of the tallest building in the Philippines. It has a total ground to architectural top height of , with 52 storeys including an 8-level radio tower...
in Ayala Avenue
Ayala Avenue
Ayala Avenue is an avenue in Makati City in the Philippines. It is one of the busiest thoroughfares in Metro Manila, crossing through the heart of Makati's central business district. Because of the many businesses located on the avenue, Ayala Avenue is aptly nicknamed the Wall Street of the...
.