Petron Corporation

Petron Corporation

Type	Public Corporation
Industry	Oil and Gas
Founded	1933
Headquarters	Petron Megaplaza, Makati City, Philippines
Key people	Ramon S. Ang, Chairman and CEO
Products	Oil Natural gas Oil refining
Revenue	4.105 billion USD (2009)
Net income	99.0 million USD (2009)
Total assets	2.63 billion USD (2009)
Total equity	872.91 million USD (2009)
Employees	9,236 nationwide
Parent	San Miguel Corporation(68.26%)
Website	www.petron.com

Petron Corporation's headquarters in Makati City, Philippines.

Petron Corporation (PSE: PCOR) is the largest oil refining and marketing company in the Philippines, supplying more than a third of the country’s oil requirements.

Petron operates a refinery in Limay, Bataan, with a rated capacity of 180,000 barrels per day (29,000 m³/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 (PNOC) and the Aramco Overseas Company B.V. each owns a 40% share of equity, with the remaining 20% is held by close to 190,000 individual stockholders. In 2008, Saudi Aramco sold its entire stake to London-listed investment group Ashmore Group, 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'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 sold its business to the government which became the Philippine National Oil Company (or PNOC). Subsequently, Mobil 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 in the Philippines as a tanker (Solar 1) carrying fuel oil 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, 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 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 fuel, kerosene, industrial fuel oil, solvents, asphalts and mixed xylene.

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 in November 2008.

The plant has the capacity to blend 12,000 metric tons (MT) of fuel additives per year. When used in gasoline, diesel, or fuel oil, fuel additives improve efficiency, boost engine performance, and benefit the environment by reducing harmful emissions.

The facility was constructed in partnership with Innospec, 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.

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 feedstock units, namely, the Petro Fluidized Catalytic Cracking (PetroFCC) unit and a Propylene Recovery Unit (PRU) at its 180,000-barrel (29,000 m³)-per-day Bataan 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 City, the company's headquarters, the Petron Megaplaza, 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 in Ayala Avenue.

External links

• Petron
• Petron Mega Plaza details