Black gold with a green twist

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Unioil Petroleum Philippines Inc. Chairman Paul Co believes petroleum companies should also be concerned about the environment.

Unioil Petroleum Philippines Inc. Chairman Paul Co believes petroleum companies should also be concerned about the environment.

YES, that headline may seem like an oxymoron. But for Unioil Petroleum Philippines Inc. Chairman Paul Co, it succinctly describes the thrust of the growing independent oil company.

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“For me, business is not all about money,” he said. “We need to be concerned about the impact that we’re making on the environment. Everything that businesses use to produce their products comes from nature and this is especially true in our line of work.”

This surprisingly “uncapitalist” guiding philosophy is why Co said Unioil has consistently been ahead of the competition (and the government) in introducing cleaner fuels in the Philippines, to the point that it has become an essential part of the brand’s identity.

The eco-friendly oil company
“Brand awareness was the challenge we had as a new player then,” he said of the company’s entry into fuel stations in the late 1990s. “We overcame these by establishing ourselves as the company bringing in world-class, environment-friendly fuels to the market and by staying true to this identity through the continuous evolution of our fuel products.”

These products included Quantum – which Co said was the first Clean Air Act-compliant unleaded gasoline product with a maximum of 2 percent benzene and 35 percent aromatics – that was introduced in 2002. In addition, the company worked on cleaning up the dirty image of diesel engines in 2003 by introducing Pure Diesel, which adhered to Euro2 fuel standards by only having 500 parts per million (ppm) of sulphur, and improving it with Pure Diesel Plus in 2005.

Benzene is used to produce everything from motor fuels to inks, but long-term exposure to the chemical (often from breathing it in) affects the blood and can cause cancer, particularly leukemia. Meanwhile, aromatics other than benzene are used to increase the octane rating of gasoline and the cetane rating of diesel, but can be harmful when inhaled as ultra-fine particles in the air.

Finally, sulphur is a chemical component in all fuels, but becomes the very harmful sulphuric acid when combined with water vapour in the combustion (or “bang”) stage in engines. Sustained sulphuric-acid emissions also contribute air pollution and acid rain, which can damage external and internal organs.

Unioil went a notch higher in their advocacy by introducing Euro4 diesel in 2012, then making all of their fuels Euro4-compliant a year later. These were all introduced ahead of the implementation of Euro4 fuel standards in the country, which the Department of Environment and Natural Resources mandated by department order that required all fuels sold in the Philippines starting January 2016 to have a maximum of 50 ppm of sulphur and 35 percent of aromatics, while unleaded gasoline may only have up to 1 percent of benzene.

The previous Euro2 standards, imposed in the implementation of Republic Act 8749 or Philippine Clean Air Act of 1999, mandated a maximum of 500 ppm of sulphur, 5 percent of benzene and no limit on aromatics.

Sustainability as success
Co said he has been with Unioil for most of his life, calling himself a “second-generation businessman” and is now semi-retired. He said his environmental consciousness was formed early in his life.

“This sense of responsibility was something that we learned at home,” he said. “When our business was in its infancy, we were taught to conserve water and energy and make the environment cleaner. This is something that was instilled in me and something that I continued to develop as I grew older.”

Co said his family established Unioil in 1966,when it was known as Union Refinery Corporation, venturing into service-station franchises when the oil industry was deregulated in 1997. The company opened its first station along NAIA Road in Parañaque City (Metro Manila). This year, Co said the company plans to open up to 17 service stations nationwide, bringing their total network to around 60 by year-end.

“Our main target for retail station expansion is still within Regions 3 [Central Luzon], 4A [Calabarzon], and NCR [National Capital Region or Metro Manila] because of these areas’ proximity to our storage facilities,” he said. “We also believe that these areas have strong demand and long-term growth potential.”

Despite the dramatic tumble in local oil prices in recent months, as a result of increased supply in the world oil market, Co said he is not too worried about how this will affect the company’s revenues.

“We foresee a lower cost of doing business and an increased demand for fuel,” he said. “We’re seeing that cheap oil can be an advantage and can impact our performance positively because we do import our supply. While we can’t disclose how this will move the needle, if at all, what we can tell you is that we continue to base our prices on international movements and we will adjust as the market adjusts.”

Supporting local driving talents
Co said his semi-retirement has allowed him to further pursue his passion for motoring. Co even participated in this year’s Cannonball Run in Clark City, Pampanga, with Unioil serving as a major sponsor for the event.

“We share Cannonball’s advocacy of promoting Philippine tourism and supporting the next generation of Filipino drivers,” Co said of Unioil’s sponsorship. “It is an event that brings people together—this year, our team is composed of long-time friends who have enjoyed a lot of rides and journeys together and a lot of father-and-son teams who are in this event as a way for them to bond over their love for motoring. Having the opportunity to fuel their passions and strengthen their connections is something we couldn’t pass up.”

The company fielded 20 cars and 25 motorcycles for this year’s Cannonball, including a Mercedes-Benz SLK 200 (belonging to Co’s wife) piloted by celebrity racing driver Gaby Dela Merced. Co also said the event served as a kick-off for the company’s golden anniversary.

A world without oil
Despite the nationwide implementation of Euro4 standards, the Philippines lags far behind emission standards in other countries, with Europe already using even stricter Euro6 standards. But Co said all the questions the company has been receiving about even cleaner fuel is a good sign.

“We should all pay attention to this transition to Euro4, take the lessons that we will learn from it and apply it when we upgrade to Euro5 and [Euro] 6,” he said. “Whatever we learn during this transition will help us—we will be better at setting up incentives, preparing for the transition, working with different stakeholders and staying ahead of the timeline.”

Co even said he welcomes the passage of the United Nations COP 21 agreement in Paris late last year, which the Philippines also signed. Among the provisions of the agreement include totally losing dependence on fossil fuels.

“At this time, we cannot comment on our long-term strategy, but what we can tell you is that we will continue looking into trends and movements in our industry, figuring out how we can innovate and deliver innovative products to our customers,” Co said on how the agreement would affect Unioil.  “Our track record shows that we have always found new ways to deliver our commitment to providing customers with world-class, environment-friendly products and we intend to continue delivering on our commitments to our customers.”

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