December 20, 2018 | 12:01 am
THE PHILIPPINE National Oil Co.
(PNOC) has shared the frustration of the Department of Energy (DoE) on the
constraints that have hampered the company’s projects, including the
development of what could have been the country’s first liquefied natural gas
(LNG) import terminal.
PNOC President and Chief Executive
Officer Reuben S. Lista said in a text message on Wednesday that “a rider
provision in the Republic Act No. 7638 or the Department of Energy Act, has
effectively limited financial autonomy of the PNOC as a corporate vehicle, by
requiring Congressional approval of its annual budget.”
Despite the fact that none of PNOC’s
budget is sourced out of the general appropriations, Mr. Lista said it has to
first seek clearance from lawmakers on its budget before it can earmark and use
its own money to fund projects.
He said as a government-owned and
-controlled corporation (GOCC), PNOC “is bound by stringent government
regulations,” including procurement, joint venture and public-private partnership
guidelines, before it can engage, by itself, in a project of a magnitude such
as the proposed LNG terminal for the government.
Mr. Lista was reacting to DoE
Secretary Alfonso G. Cusi’s statement to media that he would have proceeded
with the project and sought partners later. Mr. Cusi is the ex-officio chairman
of PNOC.
“The PNOC has earnestly been trying
to find ways to accomplish objectives within the limitations and restrictions
imposed under it by law and has now been constrained to ask for fiscal autonomy
from Congress in order that it be able to meet expectations of its lead agency,
the national government and the Filipino people as we seek to regain our
relevance and developmental role in the energy industry and the country,” Mr.
Lista said.
He also clarified that PNOC as a
GOCC is far from being non performing. He said the its board, management and
staff “is, in fact, proud to report that it has, under [Mr. Lista] exceeded
previous annual net earnings of the company minus its earnings from dividends
from its subsidiaries, which are now remitted directly to the National Treasury
due to a 2016 directive from Department of Finance (DoF).”
When he assumed his position in
November 2016, Mr. Lista announced his plan for PNOC to revert back to an
operating company from a mere holding company for its subsidiaries PNOC
Exploration Corp. and PNOC Renewables Corp.
He said as the corporate arm of the
government in energy projects, it has the mandate to engage in energy business
and projects in behalf of the government and Filipino people — including the
much-coveted LNG terminal project.
“It was in this spirit that the
statement that it might be better to abolish PNOC if it will not be empowered
with the authority and autonomy necessary to effectively participate in the
highly-competitive energy industry was made. The statement was borne out of
shared frustration from bureaucratic red tape that has been the stumbling block
for the PNOC’s ability to mobilize its funds for much needed projects of
national significance to be instrumental in contributing to nation building and
making a difference to improve the quality of life of every Filipino,” Mr.
Lista said.
The statement by Mr. Cusi that it
might be best to abolish PNOC “relating to these budgetary constraints and how
it has hampered effective corporate governance with the means to be at par with
the private sector have been taken out of context,” Mr. Lista said.
Last month, PNOC announced that it
had “postponed until further notice” the process of selecting a partner for the
LNG terminal project.
Mr. Cusi had envisioned the project
to transform the country into a regional LNG hub, saying that it had been
performing as one.
In a notice posted on its website
dated Nov. 21, 2018, PNOC said it had postponed the pre-eligibility activity
that was supposed to be on Dec. 4. It also postponed the submission date of
eligibility documents. — Victor V. Saulon
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