Amid calls on the national government to buy back Petron to tame oil prices, San Miguel Corp. (SMC) President Ramon S. Ang on Monday told lawmakers that he is willing to sell the oil company back to the government.
During the briefing of the House Committee on Ways and Means on proposals suspending or reducing the excise tax on fuel products, Ang, who is also the president of Petron, said he could sell the company to the government immediately and allow the state to pay for it on a staggered basis.
“Anytime, I could sell [Petron back] to the government. They can pay for it for five years. If they want to buy it, I swear, I am ready to sell it immediately,” he told lawmakers.
Ang said the government could pay for Petron at market valuation in the next five years without a premium.
“If you think that’s [Petron] a jackpot business, then let the government buy it at market valuation and no need to add premium,” said Ang.
He said Petron, a subsidiary of SMC, incurred a net loss of P11.4 billion in 2020 after sales suffered from a slump in demand, poor refining margins and a collapse in global prices.
Petron recorded a net income of P3.87 billion in the first half, a turnaround from the P14.24-billion net loss it suffered in the same period last year due to the pandemic.
House Deputy Minority Leader and Bayan Muna Rep. Carlos Isagani Zarate said his party list has been filing a bill to buy back Petron and other bills to regulate the oil industry and control petroleum prices since the 15th Congress.
“Now it is House Bill 4711 or the Renationalize Petron bill. As it is, Petron Corp., which used to be state-owned and controlled, is currently the largest and the only publicly listed oil refining and marketing company in the Philippines and it would have a significant effect in mitigating oil price hikes,” said Zarate.
If enacted, he said the specific policy objectives of Petron shall include, but shall not be limited to, the following:
- To adopt a pricing policy that shall keep the prices of crude oil and petroleum products, sold in wholesale or retail to local consumers, as socially and economically viable as possible and as allowed by the fulfillment of the objectives of the bill;
- To control cartel and monopoly pricing, and thus check unreasonably high prices; and
- To raise and promote the local capacity for exploration, refining and exploitation, processing, and development of petroleum.
‘Welcome news’
Bayan Muna Rep. Ferdinand Gaite said the offer of Ang to sell Petron back to the government is “welcome news” and that the current administration or even the next one should take up the offer so that government can have a say in controlling oil prices.
“In fact our House Bill specifically calls for the full renationalization of Petron in a span of 4-5 years so that we can have a midterm to long term deterrent to runaway oil price hikes,” said Gaite. “Indeed, there is a pressing need for government to regulate and intervene in the oil industry to protect the majority of Filipinos from runaway increases in oil prices.”
“But due to the control of monopolistic, transnational corporations, regulation can only be effective and truly beneficial if it is part of a program to institutionalize national oil industrialization, so that local oil prices can be brought down from the unreasonable and unjustifiable levels set by giant transnational oil corporations and can be prevented from falling prey to further monopoly pricing and manipulation.”