Manila says Indonesia commits to back-up oil
Manila says Indonesia commits to back-up oil
Reuters, Manila
The Philippines said it had won a commitment from Indonesia for additional oil supplies in case a war in Iraq squeezed its traditional crude sources from the Middle East.
Pertamina, Indonesia's state oil firm, pledged the additional crude as back-up in the event of disruptions to the Philippines' Middle East sources, state-owned Philippine National Oil Co said at the weekend.
"Indonesia through Baihaki Hakim, president of Pertamina, has committed to provide additional oil supplies for the country. This will provide us with a back-up contingency plan to ensure security and reliability of oil supply in the domestic market," PNOC president and chief executive Thelmo Cunanan said.
Cunanan, who negotiated the deal with Pertamina officials, did not provide any further details.
Indonesia is southeast Asia's largest oil and gas producer, pumping about 1.1 million barrels of crude a day.
Energy Secretary Vincent Perez said the arrangement stemmed from discussions at the recent World Energy forum in Japan and was an example of ASEAN member commitments to regional oil security.
"We are pleased that, as part of the ASEAN commitments, we could depend on other member countries, particularly Indonesia, to provide us the additional oil supply," Perez said.
He also confirmed that the government would send a high-level mission to Russia by the end of this month to negotiate a contingency supply arrangement.
Oil giant Saudi Aramco, which owns 40 percent of Petron Corp, one of the country's major refiners, has also indicated its commitment to provide additional crude if necessary, Perez said.
He added that the Philippines' oil supply remained steady.
Under its oil contingency plan, the government plans to boost its oil inventory to at least 60 to 90 days.
As of last month it had stocks of around 55 days.
Fears of a U.S. attack on Iraq because of its non-compliance with U.N. resolutions on weapons inspections have sent oil prices rocketing in recent months.
Dubai crude, the main oil source for the Philippines, ended at US$28.13 a barrel on Sept. 24, its highest closing mark since finishing at $28.57 on Nov. 30, 2000.
Last Friday prices softened slightly ending at $26.78.