Manila: Maharlika Investment Corporation (MIC), the entity responsible for managing the country's sovereign wealth fund, is considering a partnership with the state-owned Philippine National Oil Co. (PNOC) and the private sector to construct oil storage tanks. This initiative is part of a broader government strategy to enhance energy security in the Philippines.

According to Philippines News Agency, during a recent House of Representatives' Legislative Energy Action and Development Joint Committee hearing, MIC President and CEO Rafael Consing Jr. highlighted that although PNOC has allocated funds to increase oil reserves, the current storage capacity remains insufficient. Consing elaborated on the potential for a consortium involving PNOC and private sector partners who could contribute assets such as land to the project.

Consing further explained that while MIC and private partners could provide capital for the tank farm, the operation of these facilities would be outsourced to private entities with the necessary expertise. "We don't know how to operate this," Consing stated, emphasizing the need for experienced operators while MIC focuses on catalyzing investment.

He also expressed a preference for investing in storage facilities rather than purchasing fuel inventory due to the associated market risks. "If Maharlika were to come in and support the Strategic Petroleum Reserve Fund by buying the inventory, we, as MIC, would be exposed to market risk," Consing noted, underscoring the strategic decision to avoid such exposure.

In a separate communication, Consing revealed that initial discussions with PNOC commenced last week. However, he emphasized that the proposed partnership would require approval from the respective boards and investment committees of the involved parties. Following approval, a technical working group will be established to move the project forward.