Isla LPG spending P450m for new plant
Isla LPG Corp., a joint venture between Itochu of Japan and the Citadel Holdings Inc. of the Delgado Group, is investing P450 million this year to expand its liquefied petroleum gas operations nationwide.
Isla LPG sells the Solane brand (formerly Shellane) after acquiring Shell’s Philippine LPG business at around $131 million in January last year.
“We have allocated over P450 million [capex this year]. We will come up with a new refilling plant in Calamba. We will also spend for the LPG tanks,” Isla LPG chief operating officer Ramon del Rosario told reporters.
The new plant, estimated to cost P30 million to P50 million, will have a capacity of 350 to 650 metric tons that will supply Metro Manila’s requirements over the next 25 years.
Del Rosario said the company would use internally generated funds to finance its capital expenditure this year, or more than double Isla LPG’s capex allocation of over P200 million last year.
Del Rosario said he expected the company’s earnings to reach P600 million in the next five years from P300 million at the end of 2012, driven by the anticipated increase in its commercial and industrial accounts.
He said Isla LPG was looking at its expanding its distribution network to include previously untapped areas such as Palawan, Masbate and Zamboanga.
The company currently has 50 existing distributors as of end-2012 and considers 10 more distributors by end of this year.
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