Philippines seeks UAE partnership for strategic oil hub by 2027

MANILA: The Philippine government is seeking a partnership with the United Arab Emirates (UAE) to build a strategic oil storage facility that could position the country as a regional energy hub and reduce its exposure to global price shocks.

Senate Energy Committee Chairperson Erwin Tulfo said discussions were held with Abu Dhabi National Oil Co. (ADNOC) in Abu Dhabi on Oct. 29, local media reported.

The proposed facility, following the UAE-Philippines Comprehensive-Economic Partnership Agreement (CEPA) signed in June, would serve as a regional oil hub for ADNOC and anchor a broader energy partnership.

The talks covered crude supply, refinery investment, fuel-retail networks, renewable energy and gas-to-power development.

Tulfo said the oil-storage project could bolster national energy security and help protect consumers from volatility in global oil prices.

Both sides set a tentative rollout target of the second quarter of 2027.

The timeline remains conditional on agreements on the facility’s location, infrastructure responsibilities, commercial terms and implementation schedule.

The UAE team proposed sharing an existing storage-contract framework for Philippine review.

Tulfo said he would lead follow-up discussions to move the initiative forward, but acknowledged that no formal agreement has been finalised.

The Philippine delegation included Ambassador to the UAE Alfonso Ver and Special Envoy for Trade and Investment Kathryna Yu-Pimentel.

They indicated that government-to-government cooperation, alongside private-sector participation, could make the project viable.

The proposal comes as the Philippines remains heavily dependent on imported fuel and faces price pressure from a weaker peso, global oil movements and supply disruptions.

A strategic reserve could provide a buffer during geopolitical or logistics crises.

Recently, Saudi state-owned energy giant Saudi Aramco was reportedly in talks and preliminary evaluations with the Department of Energy (DOE) and the Philippine National Oil Company (PNOC) to fund, build, and operate a major commercial oil storage and export hub in Bataan, Philippines.

On October 28, Philippine Secretary Sharon Garin told Reuters her country is ​also in talks with Russia and the United States to store oil in the fuel-import-dependent nation in a bid to hedge against fuel price spikes driven by the Iran war.

The Philippines imports nearly all its energy needs, and plans to increase diesel and gas-fired power output to make up for an estimated 60% decline in ​hydropower and 20% fall in solar output in the first half of 2027 due to the El ​Nino weather phenomenon.

The Philippines imports most of its fuel, so a UAE-backed storage hub could improve energy security and cushion consumers from global price spikes. But the project remains at the negotiation stage.

Watch for a memorandum of understanding, site selection, ADNOC’s storage-contract framework review and financing details. The second-quarter 2027 target will hold only if both governments finalise commercial and infrastructure terms.

If built, the hub could reduce fuel-supply disruptions and help stabilize pump prices during global shocks. But consumers will not see benefits until the facility is completed, stocked and integrated into the supply chain.