As the entry of a new shareholder seems imminent, Petron Corp. plans to invest US$1.5 bln in a new facility. This investment will be allocated for production of high-value products and petrochemical feed stocks, mainly through the second phase of its Petro Fluidized Catalytic Cracker (PetroFCC) unit, which should be on stream by 2014. PetroFCC has a conversion capacity of 19,000 bpd and will have the capacity to produce 140,000 metric tons of propylene. In the long term, Petron's PetroFCC is also expected to boost operating efficiency at its 180,000 bpd Bataan refinery.
The master plan also includes establishment of a BTX unit that will produce aromatics such as benzene (scheduled for completion by the end of the year.)and toluene and expand the company's mixed xylene production. Awaiting details of a definite funding program, it seems that equity and borrowings, will be preferred, in all likelihood, by the company.
The company awaits the decision of Philippine National Oil Co. (holding 40% of Petron) regarding exercising its right of first refusal in the proposed sale of Aramco Overseas Co.'s 40% stake in the oil firm to Ashmore Group company SEA Refinery Holdings for US$550 mln. The proposed sale of the Aramco equity to Ashmore is a positive development, enabling Ashmore to help inject cash for its proposed expansion opportunities.