Expensive storage
“We have to do the math because we don’t want to spend too much. Because while we have it, we have to pay for storage. I mean, the rent of the space to store it. So, the longer we keep it, the more expensive the storage,” Garin told reporters.
“So, we’re starting to unload to lessen the rent costs,” she added.
The government earlier bought 21,000 metric tons of LPG from the international market under its emergency energy security program as geopolitical tensions threatened fuel supplies.
The cargo, split equally between propane and butane, arrived from Texas in May.
Stocks sold below prevailing market prices
Garin said the government generally tries to sell the stocks below prevailing market prices to speed up their disposal, although actual selling prices still depend on international prices.
Once the inventory is depleted, the DoE does not immediately plan to replenish it, with domestic LPG supply currently deemed sufficient.
“For LPG, so far, no need. Because we really have enough,” Garin said.
The improved supply outlook also reflects efforts by local companies to diversify their sources beyond traditional suppliers in Southeast Asia and the Middle East.
“Now, they’re buying from America. So, luckily, our companies have learned to be resilient and to spread their risk. So, we have many sources,” Garin said.
More import and storage capacity is also coming online. The newly built Isla Import Terminals facility in Batangas has a nominal storage capacity of 25 kilotons for propane, butane and mixed LPG and can receive shipments from very large gas carriers.
Still, LPG is not yet part of the government’s planned strategic petroleum reserve. Garin said LPG storage is more complicated than keeping conventional liquid fuels such as diesel and gasoline because it requires tighter pressure and temperature controls. The DOE also sees less urgency to build an LPG reserve given adequate domestic supply.
