Refinery upgrade to lift Petron’s profit
Petron Corp. expects to post a higher profit next year, with the start of the full commercial operations of the modern Bataan refinery by the first quarter, the company’s top executive said Thursday.
Petron president and chief executive Ramon Ang said results of the testing for the $2-billion master plan 2 of the 180,000-barrel-per-day refinery showed it could increase the company’s gross margin to 20 percent from just 3 to 5 percent.
“The Petron refinery is running very well. I think we can achieve the target efficiency sooner than expected. With that, Petron’s business even at low oil prices is still going to be very profitable because of the modernization of the refinery,” Ang told reporters.
“For Petron, if it continues to run this way, it should give you at least 20 percent gross margin. The old refinery had a gross margin of only 3 to 5 percent. Our target when we made the refinery model decision is to achieve a 15-percent gross profit in sales of the refinery,” he said.
Ang said that with the completion of the master plan 2, the refinery was now able to recover crude at a rate of 98.7 percent, up from 67 percent recovery rate previously.
“We were expecting the refinery to reach 98 percent recovery by next year, 2016. But as of September we have already achieved it,” Ang said.
Petron earlier said the commissioning and stabilization runs of refinery master plan 2 which started to produce more high-value products.
RMP-2 took about 44 months from inception to completion. The construction phase alone was completed in 21 months. The company expects the full commercial operation of the refinery by early 2016.
The project employed around 17,000 skilled workers at the peak of construction. It was completed with an impeccable safety record of more than 75 million man-hours without lost time incident.
RMP-2 transforms Petron’s refinery into one of the most advanced facilities in the region in terms of processing and energy efficiency, operational availability and complexity.
It allows the Bataan refinery to fully utilize its production capabilities by converting all negative margin fuel oil into high-margin products such as gasoline, diesel, and petrochemicals.