- Refining & Marketing
Pilipinas Shell to evolve retail business into destination hub
Pilipinas Shell will evolve its retail business strategy from a fuel station into a destination hub as it creates mobility sites with more customer-centric offerings, the Shell affiliate in the Philippines said.
Alliances with international and local brands that are coupled with full vehicle servicing such as car wash and oil change lounges will turn each mobility site into a one-stop community hub. It will continue to increase its accessibility to customers nationwide by opening 60 to 80 mobility sites per year. Through the expansion, Pilipinas Shell is aiming to grow alongside the Philippine economy by increasing mobility fuels volumes by ~4% per year and convenience retail profits by ~15% per year.
Reliable, competitive & sustainable supply chain
Pilipinas Shell continues to make structural additions to its world-class supply chain to make it more competitive, reliable, and customer centric. Currently operating three Medium Range (MR) capable import terminals in Batangas, Cagayan de Oro, and Subic, Pilipinas Shell plans to add two more MR terminals by 2025. MR terminals can take in ~300,000 barrels of petroleum products per shipment which allows for reduced logistics cost. Capital expenditures of ~PHP1 billion (USD21 million) per annum is dedicated to increasing and strengthening its supply chain across the country, the company said.
“We assure the public of supply security and reliability. We will continue to invest in the country to expand our capacity to support our marketing growth aspirations,” said Cesar Romero, president and chief executive officer. The enhancements are expected to generate structural savings of PHP850 million (USD17.7 million) from the transformation of the refinery into a full import facility and the operation of the Subic facility this year. At least PHP600 million (USD12.5 million) savings is expected from 2023 onwards from the additional supply chain enhancements.
Contributing to the energy transition
The company reiterated its commitment to continuously contributing to Royal Dutch Shell’s energy transition direction by offering innovative low carbon products like Shell Helix 0W lubricant for vehicles and Shell Bitumen FreshAir which reduces carbon emission by 40% for road pavements. Its first carbon offset deal with a customer was also secured earlier this year.
Lower carbon operations is currently being gradually implemented across Pilipinas Shell’s assets. The continued installations of solar panels, greenwalls, LED lights, inverter technology, and the use of ecobricks or upcycled plastics in its mobility sites are expected to reduce energy consumption by approximately 30% versus a traditional site. Vapor recovery units at terminal loading stations will be installed and the use of onboard telematics for its fleet solutions business will be used, among others.
“The circumstances of 2020 allowed us to demonstrate the resilience of our company. Pilipinas Shell is confidently looking forward to fulfilling the country’s energy and mobility requirements with its refocused strategy, bringing customer-centric innovative offerings, backed by its strong balance sheet, technical capability and resources, and world-class supply chain. We are here to power progress and make the future of energy for the Filipinos. Pilipinas Shell is looking forward to our next century in the Philippines,” Romero said.