PILIPINAS Shell Petroleum Corp. expects to see demand for fuel products to go back to pre-COVID-19 levels by 2022 if the government’s health measures turn out positively, company officials said.

“We are aspiring to grow our… earnings in line or at least higher than the projected GDP (gross domestic product) growth rates of the country. If the government health measures will progress as promised, then we can assume that the petroleum demand will go back to pre-pandemic levels by 2022,” Pilipinas Shell Chief Financial Officer Reynaldo P. Abilo said during the firm’s annual stockholders meeting held virtually on Tuesday.

He added that energy demand, coupled with vehicle sales and household spending, are expected to grow as the economy recovers.

Pilipinas Shell President Cesar G. Romero said that the firm’s performance is “strongly correlated” to how the Philippine economy will perform this year.

“If the Philippine economy recovers in conjunction with positive developments in the health crisis, then we see every reason to see improvements in our businesses as well. Having said this, the impact of COVID-19 to our business is still present [such as] slower demand due to increase in COVID-19 cases, including logistical constraints in stations in areas where quarantine is imposed,” Mr. Romero said during the meeting.

The company earlier reported a net loss of P16.18 billion for 2020 mainly due to one-time charges, which came with the transformation of its Batangas refinery and the global drop in crude oil prices.

Mr. Romero, who is also Pilipinas Shell chief executive officer, reiterated that majority or P12 billion of the losses came from transforming the firm’s 110,000 barrels-per-day refinery in Tabangao, Batangas into an import facility.

Mr. Abilo said that the firm expects to realize savings of around P700 million in 2021 and an additional P300 million in 2023 once it turns its former refinery into a “world-class import facility.”

“A key feature that we expect to see from the refinery conversion is the higher degree of ratability in our performance and reduced volatility of our earnings. Now that we have a fully imported supply chain, we will have no more exposure to the highly volatile and currently depressed refining margins,” he said.

He added that the new import facility will allow the re-deployment of capital expenditure to assets or projects that bring in higher yields and reduce exposure to inventory holding losses.

Pilipinas Shell aims to add two more medium-range import terminals by 2025. Previously, it said that it is allotting a yearly capital expenditure of around P1 billion per year to “strengthen its supply chain across the country.”

Shares in the company at the local bourse improved 0.46% or 10 centavos to close at P21.90 apiece on Tuesday. — Angelica Y. Yang