Petronas seeks to join PRP refinery project

Petronas seeks to join PRP refinery project

SINGAPORE (Reuter): Malaysia's state-owned oil company Petronas is seeking to acquire a stake in the proposed US$4 billion Mindanao refinery in southern Philippines, sources close to the project said yesterday.

Analysts said Petronas' bid to join the Iranian and Filipino group, which plans a 150,000 barrel-per-day (bpd) refinery, is part of the company's efforts to raise its profile in the Philippines, particularly in the south.

"Petronas has expressed an interest, its up to them (consortium members) to consider, evaluate and make us a proposal," one source said.

Sources said Petronas' participation in the project would depend on the offer made by the parties involved. A Petronas spokesman declined to comment on the proposed deal.

On Sunday, the official Iranian news agency IRNA said Iran planned US$4 billion in industrial investments, including the refinery, liquefied petroleum depots and a cement plant.

An Iranian delegation signed a memorandum of agreement with Philippine investors to pursue various industry projects. Mindanao island, the second biggest in the country, is the ancestral homeland of Moslems in the Philippines and has a population of five million.

Petronas is already beefing up its presence in Mindanao through the construction of a liquefied petroleum gas (LPG) bottling plant which is expected to be operational at the end of this year, a company spokesman said.

Petronas currently only distributes LPG in the area.

Earlier this month, Petronas said it had taken up a 20 percent interest in a 250,000 tons-per-year polyethylene plant that is expected to start up in 1999 in Bataan, northern Philippines.

Petronas is also involved in oil exploration in the Philippines where it has a partnership with the Philippine National Oil Company-Exploration Corp to explore for oil in Cotabato, also in the south.

The company is seeking to set up a chain of petrol stations in Mindanao.

"We have planned to set up retail in Mindanao in the Philippines," president and chief executive officer Hassan Marican told Reuters in June.

Petronas currently runs 12 service stations in Phnom Penh in Cambodia and two in Bangkok.

Industry sources said Petronas has targeted the Mindanao area for investment as part of its expansion into the Southeast Asian market.

The company is still in talks with Vietnam to build the country's first oil refinery.