Investments board approves Seaoil’s Davao depot facility

The Board of Investments (BOI) said Tuesday it has approved the registration of Seaoil Philippines’ four storage-tank oil depot in Davao del Sur.

The oil depot has a combined capacity of 36.9 million liters and will contain both gasoline and diesel fuels, the BOI said in a statement.

The P287-million project is qualified for Bulk Marketing of Petroleum Products under the Investment Priorities Plan (IPP) - Special Laws list in accordance with Republic Act 8479 or the Downstream Oil Deregulation Act of 1994.

RA 8479 liberalizes and deregulates the downstream oil industry in order to ensure a truly competitive market under a regime of fair prices and adequate and continuous supply of environmentally-clean and high-quality petroleum products by encouraging the participation of new oil industry players through the provision of incentives.

Seaoil Philippines is a company owned by businessman Francis Yu with Caltex Australia as minority partner.

The approved activity, which already started operations in September, provides an additional 36.9 million liters of gasoline and diesel to its existing 41.050 million liters of storage in the southern part of Mindanao which translates to a total of 78.150 million liters of fuel capacity, according to the BOI.

“This combined capacity is actually more than enough to accommodate the average daily requirement of 73 million liters of fuel nationwide. The additional storage capacity of fuel means additional supply of fuel may allow the company to efficiently manage its inventory levels and avoid external shocks that could lead to oil price hikes or at the very least mitigate its price increase in several parts of Mindanao,” Trade Undersecretary and BOI Managing Head Ceferino Rodolfo said.

Seaoil said that with the additional depot capacity, its diesel prices could possibly experience a price drop of around 10 percent or around P5 cheaper than the prevailing prices. This is on top of the weekly rollbacks due to the continuing decline in global oil prices. —Ted Cordero/KG, GMA News