Shell Starts Production at First Bitumen Blending Facility in the Philippines

Feb 2019

The production of the first batch of bitumen was completed at a new bitumen blending facility owned by Pilipinas Shell Petroleum Corporation, the local Energy subsidiary of global giant Royal Dutch Shell. Being the only bitumen producer in the Philippines, Shell invested about USD 14 million in bitumen-asphalt production inside their Tabangao refinery in Batangas, which is about 80 to 100 km south of Manila.

The opening of Shell’s bitumen facility is good news in the Philippines, as the country is historically import-dependent of this asphalt component. Ultimately, having local bitumen production supports the integrity and reliability of local contractors, because it can boost supply reliability, and bring the possibility of improving the management of price risks associated with volatility in market prices. 

Shell is a global leader in bitumen technology and currently holds 49 active patents linked to bitumen and asphalt. In the Philippines, the company is well-established and has locally available technical assistance to support special project requirements. Shell’s bitumen-asphalt production facility in Batangas will both serve the domestic and regional market. 

Meanwhile, earlier in 2018, local company Phoenix Petroleum Philippines Inc. announced plans of putting up a PHP 275 million (USD 5.3 million) bitumen plant in Batangas, which is also in the same province as the aforementioned Shells’ bitumen facility. By the middle of 2018, the company had broken ground for the construction of its own asphalt plant which is expected to be completed sometime in 2019. Phoenix entered into a joint venture agreement  with Thailand’s TIPCO Asphalt and Carlito B. Castrillo of PhilAsphalt (Devt) Corp. to enter the business of bitumen and bitumen related products in the Philippines.

These developments come on the back of the present Philippine government’s ambitious Infrastructure program, which is expected to cost a whopping PHP 9 trillion (USD 173 billion) until 2022. Majority of the flagship projects of this program are in the transportation sector – six airports, nine railways, three bus rapid transits, 32 roads and bridges, and four seaports. 

(Sources: Philippine Star, Shell, Phoenix Petroleum)

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