Petron Corp. is pursuing a $3.5-billion expansion of its refinery in Malaysia that would significantly improve the company’s bottomline, a top executive said.
“One we complete the expansion there, we are projecting that it will give $600 million a year from $20 million,” Petron president Ramon Ang said.
Petron acquired Esso Malaysia’s Port Dickson refinery and fuel retail network in Malaysia in 2011.
Ang said Petron Malaysia showed consistent strong financial results.
“We acquire Malaysia before with $20 million Ebitda [earnings before interest, taxes, depreciation and appreciation]. This year, we will end at $270 million Ebitda,” Ang said.
Ang said once the planned expansion was given an approval, the construction would be completed by 2020.
The Malaysian refinery currently produces around 80,000 barrels per day. Petron ranks third in terms of market share in Malaysia.
“It will add another 90,000 [barrels] a day,” Ang said.
“The Malaysia expansion, if we will add 90,000 barrels per day, [would cost] $3.5 billion,” Ang said, adding that most equipment in the refinery needed to be replaced and upgraded.
Petron is also embarking on a $5-billion refinery expansion in the Philippines that will bring the existing capacity of its Bataan refinery to 360,00 barrels per day in three years.
Ang said the expansion of the existing Bataan facility would be done in phases at 90,000 barrels per day for each phase. The first phase is expected to be completed by 2019 and the next phase by 2020.
“[For] the next expansion of our refinery, we will be adding another 90,000 bpd. So from 180,000 bpd, we will be hitting 270,000 bpd,” Ang said earlier.
Petron owns the existing 180,000 bpd refinery in Limay, Bataan.
“We can start [the first phase] in 2018, to be completed in 2019. We forecast an increase in income,” he said.
Ang said the first phase of the expansion would cost $1.5 billion while the second phase would amount to $3.5 billion.
He said the expansion would help produce more petrochemical products.
Petron already invested $2 billion to upgrade its Bataan refinery and make it at par with the most advanced refineries in the region.