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December 12, 2014

LPG-MA seeks truck ban exemption for fuel tankers

News Release

Office of LPG-MA Rep. Arnel Ty, House Deputy Minority Leader

Room 607 South Wing, House of Representatives, Constitution Hills, Quezon City, Tel No. 931-5144

December 12, 2014

LPG-MA seeks truck ban exemption for fuel tankers

For faster delivery of fuel supplies from Batangas, Bataan

after Pandacan depot closure

       With the Supreme Court order shutting down the Pandacan oil depot, the Metro Manila Development Authority (MMDA) may have to spare fuel tankers from the truck ban to expedite the delivery of vital petroleum products from Batangas and Bataan, the LPG Marketers’ Association (LPG-MA) said Friday.

        “The MMDA may have to exempt fuel tanker trucks from the road ban, if only to avoid supply disruptions, which may be exploited by abusive traders as an excuse to prop up pump prices, or to delay further price rollbacks,” said House Deputy Minority Leader and LPG-MA Rep. Arnel Ty.

        The MMDA forbids trucks from Metro roads from 6:00 AM to 9:00 AM and from 5:00 PM to 9:00 PM every day, except Sundays and holidays.

        Oil companies have been rolling back pump prices on account of the 40 percent drop in the cost of crude oil in world markets since June.

        However, Ty expressed concern that profiteers might take advantage of supply chain glitches due to the closure of the Pandacan depot as a pretext to keep pump prices elevated.

        Ty was responding to the warning issued by the Department of Energy (DOE) that fuel prices may rise after Pilipinas Petroleum Corp., Petron Corp. and Chevron Corp. (formerly Caltex Philippines Inc.) wind down their Pandacan operations to comply with the Supreme Court order.

        The extra cost factor will come from the “Big Three” having to obtain their bulk supplies by road using tanker trucks, instead of sea-based barges, from their oil refineries and terminals in Batangas and Bataan, according to DOE Undersecretary Zenaida Monsada.

        "Prices may be affected, considering the difference in transport costs using a truck compared to a barge,” Monsada said.

        Monsada said some 70 percent of petroleum products in Luzon, including Metro Manila, come from the 33-hectare Pandacan depot in Manila, where the Big Three have been running storage facilities and distribution terminals.

        Monsada sees one to two days of lag time in the road transfer of oil products from Batangas and Bataan.

        The Supreme Court finally ordered the relocation of the Pandacan depot, saying it puts Manila residents at grave risk in the event of a terrorist attack.

        The Nov. 25 ruling struck down as unconstitutional Manila City Ordinance No. 8187, which provided for the depot’s continued operation.

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