The Royal Dutch Shell Group is one of the many business casualties of COVID-19″•it is quitting its Philippine oil refinery operations after nearly 60 years. Its decision to abandon the business is a black eye for the economy considering that the Shell Group is one prized investor.
But it is not too late for the Philippine government to propitiate Shell with enough incentives and keep the oil giant here, at least in other energy-related businesses. For starters, Shell is transforming its refinery in Tabangao, into “a world-class full import terminal to optimize asset portfolio and enhance cost and supply chain competitiveness.” The shift is understandable.
The price of imported petroleum products is now lower than or almost equal to the cost of refining crude oil.
Shell’s pessimistic outlook is in stark comparison to an upbeat mood in early 2008 when it weighed the possibility of expanding its Philippine refinery. Policy flip-flops torpedoed that plan.
Edgar Chua, then chairman of local unit Pilipinas Shell of Pilipinas Shell Corp. in 2008, virtually conceded that the refinery expansion was no-go. “The Pandacan depot has complicated matters,” Chua told reporters back then, adding any business uncertainty would have an impact on the company’s investment decisions.
The Supreme Court earlier ordered the relocation of the oil depot near Malacañan Palace after the city of Manila raised concerns about the safety of the facility, which is jointly operated by Pilipinas Shell, Petron Corp. and Chevron Texaco (formerly Caltex). The depot was supplying half of the country’s petroleum requirements.
Pilipinas Shell, thus, was back to square one”•it can either expand its Batangas refinery or shut it down, depending on market conditions and the level of government support.
The pandemic made it easy to for Shell to abandon the Batangas oil refinery operations. The government’s focus on the construction of liquified natural gas storage and re-gasification terminals, however, gives Shell a logical business to pursue in the Philippines. It earlier developed the mid-sized Malampaya offshore gas project in Palawan province that supplies fuel to major power plants in Batangas.
Keeping Shell as a major foreign investor in the Philippines amid these trying conditions is a must. Energy Secretary Alfonso Cusi should recognize the contribution of the Shell Group to the Philippine economy.
LGUs must account for SAP
House Deputy Speaker and Camarines Sur 2nd District Rep. Luis Raymund “LRay” Villafuerte Jr. has every reason to get mad over the scandalous distribution of state funds amid the COVID-19 pandemic.
And Local Government Secretary Eduardo Año should take heed of LRay’s call for an immediate and forceful action against abuses committed by certain local government executives in the distribution of over P200 billion-worth of cash grants to coronavirus-hit poor families under President Rodrigo Duterte’s Social Amelioration Program (SAP).
The Department of the Interior and Local Government, for starters, should now move to impose preventive suspensions against erring officials and prosecute them. President Duterte himself is not happy with the way state funds are being disbursed. He has warned during his 5th State of the Nation Address about sending errant officials found guilty of fraud in the two-tranche distribution of SAP worth P205 billion to jail.
Año conceded that at least 50 village chiefs were facing preventive suspension over the alleged misuse of SAP funds. The police’s Criminal Investigation and Detection Group has logged 155 criminal complaints against barangay captains accused of SAP anomalies.
The failure of some LGUs to liquidate the first tranche of SAP grants, according to the Department of Social Welfare and Development, was among the reasons why the distribution of the second tranche had similarly faced delays. Mounting complaints of fraud in the distribution of the cash aid by some LGUs have marred the distribution of funds.
Some of the fund abuses are blatant. Villafuerte uncovered some during a hearing conducted in June by the House committee on good government and public accountability chaired by Rep. Jose Antonio Sy-Alvarado. One such violation was allegedly committed by Iriga City Mayor Madelaine Alfelor.
Villafuerte, the main author in the House of the Bayanihan to Heal as One Act as well as the House-approved Bayanihan to Recover as One bill (Bayanihan 2), cited during the committee hearing the handing out of P5,000 in SAP grants to employees of the University of Northeastern Philippines, which he claims is owned by the mayor’s family.
Deocyl Monte Maninang, one of UNEP’s grade school teachers, confirmed in a sworn affidavit that they received the cash grants personally from Mayor Alfelor. Her father-in-law, San Roque barangay kagawad Rolando Maninang, learned about it and told her to return the SAP grant because her husband had already received one.
Maninang’s case is just a few of the examples presented by Villafuerte during the hearing. The lawmaker described Alfelor’s mishandling of the SAP grants as “gross abuse.” The mayor denied allegations that SAP grants were distributed to UNEP employees despite the claims of the supposed beneficiaries.
State funds by their nature should be judiciously disbursed to the intended beneficiary as defined by the appropriations law. Their distribution should also be devoid of politics.
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