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Letter to the Editor, November 19, 1999
Philippine Daily Inquirer (page 10)

Questions for Pilipinas Shell et al

Note: In a November 15 letter published in the PDI, Pilipinas Shell Vice President for Corporate Communications Reynaldo Gamboa explained that oil companies have become much maligned due to disinformation by so-called political activist groups. Below is my response to the data and arguments he presented.

Please allow us to react to the letter of Pilipinas Shell’s Rey Gamboa last November 15.

He disputes claims of overpricing by providing data on Shell’s sources of crude oil, but he left one important detail --- exactly how much is the landed cost (FOB value) of their procurement from Iran and United Arab Emirates during the first half of 1999?

Anyway, we’re happy that he now claims transparency in Pilipinas Shell’s operations. At this point, I hope that he will finally answer some questions we have been raising since time immemorial:

  1. How much profit (i.e., net income after tax) does Pilipinas Shell earn for every liter sold? (A weighted average will do, but of course, the price build-up of all petroleum products is preferred.)
  2. How will the profitability of Pilipinas Shell be affected in the event of centralized procurement of crude oil? (Centralized procurement refers to government action to directly import crude and then sell it to the oil companies. Rep. Enrique Garcia filed a bill last November 3 on "oil exchange," of which the essence is the same as what IBON puts forward.)
  3. At present, what is Pilipinas Shell’s crude stock inventory? (i.e., petroleum products being sold which were refined from crude oil and bought at what price levels?)

These are very simple questions which we hope Pilipinas Shell (and other interested oil firms) will answer.


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