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Govt, oil firms cite progress vs fuel smuggling

Govt, oil firms cite progress vs fuel smuggling

GOVERNMENT and oil companies have cited progress in curbing smuggling through a fuel marking program as the Department of Finance (DOF) said it has, to date, marked more than a billion liters of fuel.

Finance Secretary Carlos G. Dominguez III told reporters last Friday the government has placed special markers in about 1.1 billion liters of fuel.

Dominguez added they found out one Davao-based company was selling “smuggled” or “adulterated” oil. He said the DOF received a report that the unnamed company was selling a liter of fuel below P5.

By February 3, all gasoline, diesel and kerosene are expected to be marked completely. Simultaneously, personnel from the Bureau of Customs (BOC) and the Bureau of Internal Revenue (BIR) shall also begin field-testing activities, Dominguez said. He added that these agencies may impose penalties, as necessary, against companies proven to have unmarked, adulterated and or/diluted fuel.

The government is eyeing to collect at least P20 billion this year from the fuel marking program.

Compliance
OIL companies have also made a priority to comply with the government’s fuel marking program, which aims to plug revenue leakages from oil smuggling by placing a molecular marker on imported, manufactured and refined fuel products.

According to estimates by the DOF and the Asian Development Bank, the loss of national revenue due to oil smuggling and misdeclaration can reach as high as P40 billion. The government’s fuel marking program establishes a system for identifying fuel that has paid the correct import and excise duties.

Pilipinas Shell Petroleum Corp. said last week it will commission an automated fuel marking injection system at its Tabangao refinery in Batangas City at end-March this year.

“Our goal is to improve the safety of the process through automation. We’re aiming to fully automate the system at our refinery by end-March 2020,” Serge Bernal, vice president for External and Government Relations.

Last year, Pilipinas Shell conducted its fuel marking operations at its Northern Mindanao Import Facility (NMIF) in Cagayan de Oro City and its Tabangao Refinery in Batangas.

Shell, Petron
AS of December 1, both the gasoline and diesel import tanks of NMIF’s 90-million-liter capacity were fully marked.

Following the rollout in Mindanao, Pilipinas Shell started the fuel marking process at its Tabangao refinery last December 11.

The oil firm said it is working “double-time” to install a fully automated injection system in both the NMIF and the refinery.

Petron Corp., the country’s largest oil refining and marketing company, is working with the government to, likewise, install an automated fuel marking injection system at its Bataan refinery.

“We also continue to work with their fuel marking team for the installation of the Automatic Injection System [AIS] in our refinery,” Petron President Ramon S. Ang said.

Petron has implemented the fuel marking program at its refinery and Misamis Oriental import facility last month.