PIP testifies on rampant oil smuggling

Philippine Institute of Petroleum (PIP) Executive Director Sally Monteiro, during a hearing of the House of Representatives’ energy committee, disclosed that the government has lost close to Php93.3 billion (US$1.95 billion) in revenue from 2006 to 2008 due to oil smuggling. The House energy panel conducted an inquiry on the reported smuggling of refined petroleum products in the Subic Bay Metropolitan Authority (SBMA) and in the Manila Port Area. During the hearing, Customs Commissioner Napoleon Morales revealed the various modus operandi in smuggling oil and fuel products, which include the loading of small oil tankers or fishing boats of oil products from a mother ship stationed in international waters, misdeclaration of oil and petroleum products as aromatic hydrocarbons or catalysts to avoid payment of correct customs duties and taxes and undervaluation for imported oil to avoid payment of additional duties and taxes. Earlier, Philippine Congressman Mikey Arroyo had named five alleged oil smugglers that he said had defrauded the government of some Php3.2 billion (US$67.1 million) in taxes. According to Arroyo, Oil Link Corp. and Tri-Solid Movers Inc. were have been shut down pending a criminal investigation, while three others have pending cases with the Court of Tax Appeals. (April 23/ May 11, 2009)