Govt-run oil mills may stop operations after officials quit en masse to oppose new Palace appointee

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CIIF.PHTHREE oil mills managed by a government-controlled corporation may stop operations after a dozen of its officials resigned en-masse to oppose the appointment of a new president.

Eddie P. Delima, chair of the Coconut Industry Investment Fund Oil Mills Group (CIIF-OMG) which owns the facilities, also warned that the group’s profitability may also be affected by the change in leadership.

“This will definitely affect [operations] given that we have different priorities,” Mr. Delima told BusinessWorld in a phone interview, referring to the recently-appointed president of the group, Rehan Lao. “The profitability of the company will be affected.”

Mr. Delima, who was among those who quit, reiterated the three oil mills may have to stop operations but only until the vacancies are filled up.

On Thursday afternoon, 12 officials, including Mr. Delima, tendered their irrevocable resignation to Executive Secretary Salvador C. Medialdea after Malacañang held its ground to place Rehan Lao as the new president.

Mr. Lao, a former director of the CIIF-OMG, has been named as the new head last June 28. The resigned officials has been asking for the palace to reconsider since then.

The group has questioned the credibility of Mr. Lao, who has a pending case before the Office of the Ombudsman.

Presidential spokesman Harry L. Roque said that the resigned officials “are just there in holdover capacity,” citing a message that he forwarded to reporters on Friday.

While it “pains” the CIIF-OMG officials to submit their resignation, Mr. Delima added that they remain optimistic that the Palace will open its doors to negotiate.

“Before we left Mr. Medialdea’s office yesterday, he told us to keep our phones open. If they do not call in the next few days, then that’s that,” Mr. Delima said.

Mr. Delima added that if the Palace “takes their preferences into consideration”, they may consider coming back.

“We’ll definitely come back as long as [Mr. Lao] isn’t the president. Anybody but him.”

Known for its Minola brand, the company operates oil mills and refineries around the Philippines since the 1970s.

According to its website, CIIF-OMG’s plants have a total crushing capacity of 370,000 metric tons (MT) of copra per year, around 10% of the total coconut oil milling industry of the Philippines..

In terms of refining capacity, the company can process 240,000 MT of coconut oils.

Just a few months ago, CIIF-OMG sealed its first partnership with an international company, Swedish solutions firm AarhusKarlshamn (AAK). AAK last month broke ground on the CIIF-OMG’s Batangas property where they will be setting up oil and fats mixing facility.

Besides owning oil mills, CIIF also previously owned a block of shares in San Miguel Corporation whose ownership was later transferred to coconut farmers, thanks to a several Supreme Court decisions favorable to them. The shares were later sold and then turned into a fund for the benefit of coconut farmers which is currently being handled by the government.

In the 1970s, at the height of Martial Law, the company collected levies from coconut farmers and later used them to buy assets, including oil mills and more than 20 percent of shares of San Miguel in 1983.

At that time, the company was headed by, among others, Marcos crony Eduardo “Danding” C. Cojuangco Jr. — A. G. A. Mogato