The Philippines signed supply deals with the US, Canada, and Mexico for 66 million kilograms (kg) of liquefied petroleum gas (LPG), the LPG Marketers Association, Inc. (LPGMA) said.
LPGMA founder Arnel U. Ty said the association was informed by Energy Secretary Sharon S. Garin that the agreements were government-to-government (G2G), with the Department of Energy (DoE) expected to verify the order publicly soon.
“Secretary Garin informed us that the federal government is in touch with the three countries — that their ambassadors, through their communication, informed the Philippine government that they’ve product to be sold to the Philippines,” he told reporters Wednesday.
The federal government and the private sector are negotiating the arrival of the LPG shipments, with targeted landing dates of between May 15 and June 1.
The LPG products from the three countries are estimated to cost at the very least P2.5 billion, Mr. Ty said.
He noted that the shipments can be eventually sold to the private sector.
“(The deals) can initiate recent sources that we didn’t have before. Our country used to rely almost entirely on the Middle East for supplys,” he said.
Retailers mostly import their supply from elsewhere in Asia, aside from the Middle East.
Mr. Ty said maintaining a 60-day inventory is “expensive” for the private sector, with suppliers only willing to commit to as much as 40 days, making the G2G arrangement advantageous.
Once the orders arrive, they may add 30 days’ price of supply, bringing the country’s total inventory to around 60 days.
In a recent briefing, Ms. Garin said the inventory of LPG has increased to an equivalent of 34 days from 23 previously.
“What to anticipate though in LPG is the rise in price. The worth jump is absolutely significant because international logistics have been somewhat disrupted,” Ms. Garin said.
“But what we’re doing now’s simply to be sure that we’ve supply. Because this will not be just for beverages and restaurants, but in addition for households,” she added.
Consumers using LPG could have to face higher costs this month, as some retailers raised prices by as much as P402.93 per 11-kilogram (kg) cylinder.
Seaoil Philippines, Inc. said unit Seagas increased its LPG price by P36.63 per kg.
Petron Corp. imposed a P20-per kg hike in LPG prices after factoring in changes to international contract prices.
Solane, meanwhile, announced a hike of P17 per kg for the cooking gas.
The newest price adjustments bring the prevailing LPG price within the National Capital Region above P1,500 per 11-kg cylinder. – Sheldeen Joy Talavera