DOE replacing oil bureau director; discussions up on PUVs’ fuel vouchers

Published June 20, 2018, 10:00 PM By Myrna M. Velasco

https://business.mb.com.ph/2018/06/20/doe-replacing-oil-bureau-director-discussions-up-on-puvs-fuel-vouchers/

In the wake of recent controversies confronting the oil sector, including the planned strategic petroleum reserve (SPR) that still lacks legal and economic structures, the Department of Energy (DOE) is replacing the Director of its Oil Industry Management Bureau (OIMB), according to a highly placed source.

Lawyer Rino Abad will be replaced by Cesar G. Dela Fuente III, who will be coming from the Legal Department of the Office of the Secretary. Abad, it was gathered, will be back at the Energy Resource Development Bureau (ERDB), where he first started during the tenure of former Energy Secretary Carlos Jericho Petilla.

Meanwhile, the DOE disclosed that it will already start discussing the framework on the fuel vouchers that shall be extended to the public utility vehicles (PUVs) in the transport sector amid anticipation of oil prices soar in the coming months.

“That was part of the TRAIN (Tax Reform for Acceleration and Inclusion) Law as a mitigating measure, just like the Pantawid Pasada concept. This is still under discussion with the DOTr (Department of Transportation),” the department said.

The DOE is scheduled to meet with the oil companies this Thursday (June 21, today) to flesh out possible parameters on how the fuel vouchers could be given out to the targeted public utility vehicles, primarily the jeepneys. Under the Aquino administration, the “Pantawid Pasada” concept was extended as ‘cost subsidy’ to PUVs in the midst of record spikes in global oil prices – the first card releases then had been at R1,500 and replenished for the second round for the public transport sector. It was intended then to prevent the drivers and PUV operators from seeking transport fare hikes.

On the proposed SPR, the department hasn’t touched on the matter in the past few weeks despite previous pronouncements that the first shipment is expected within this month.

The DOE and Philippine National Oil Company-Exploration Corporation (PNOC-EC) were nevertheless cautioned that before taking plunge into that oil importation plan purportedly to set up SPR, they shall carefully study all the repercussions first, chiefly the potential “distortive market effect” of this on the deregulated oil industry – especially with the plan to offer the overseas-sourced oil just to the independent players of the sector.

Senate Committee on Energy Chairman Sherwin T. Gatchalian acknowledged that this may have deep legal implications – primarily relating to the facets of fostering level playing field in the marketplace. “They (DOE and PNOC-EC) have to really give it some thought further… you could have a scenario where the market is distorted and it might not be beneficial,” he said.

For markets that have already established strategic oil reserves – primarily the United States and Japan, their advice will be for countries to learn that it will never be easy and it’s not a spur-of-the-moment decision putting up a stockpile – since according to them, gestation period from the crafting of the legal framework to pre-development works and finally concretizing the stockpile facility took them at least five years.