Cagayan de Oro port revival to benefit PPA, Shell

MANILA, Philippines – The Philippine Ports Authority (PPA) says it expects to benefit from Pilipinas Shell Petroleum Corporation’s decision to invest P6 billion into reviving the Cagayan de Oro port.

According to PPA general manager Juan Sta. Ana, the investments made by Pilipinas Shell into reviving the port would not only increase PPA’s collections, it would also guarantee a smooth and stable fuel supply within the Philippines by 2016.

Upon completion of the rehabilitation of the port, Sta. Ana said leases, port dues, and wharfage fees would jump to P32 million per year from P1.8 million.

The reason for the shift is that Cagayan de Oro port has remained idle over the past few years. A large amount of cargo has been diverted to the Mindanao Container Terminal, which is run by the International Container Terminal Services Inc. (ICTSI).

Sta. Ana further explained that Pilipinas Shell’s move looks to turn Cagayan de Oro into more than a support investment.

Instead, Pilipinas Shell looks at Cagayan as “a major facility as they are planning to bring in import products directly to Cagayan de Oro and distribute it from there,” according to Sta. Ana, who noted Shell’s Batangas production is expected “to be short to support the fuel needs of the country by 2016.”

Should the Batangas refinery become inaccessible, Sta. Ana said it would prompt the oil firm to place another hub in Mindanao.

Pilipinas Shell intends to turn the facility into an airport-like facility. It would also refurbish the crane faciity into an MR import-capable facility.

The company also wants access to berths 11 and 13 and is proposing a long-term lease to around 7,400 square meters of the waterfront for placing their equipment and pipeline system. The structures they intend to build are expected to be movable, allowing for future expansion in the area.

Sta. Ana says the PPA board is fine-tuning rental rates and the contract length with Pilipinas Shell.

Pilipinas Shell is also investing another P320 million into improving some parts of the port, installing firefighting capabilities as well as lighting, berthing, and security systems. – Rappler.com