ONE OF two existing oil refineries in the Philippines may shut down in three to four years? time once the so-called ?mega-refineries? in China begin operations, said Energy Secretary Jose Rene D. Almendras.

China is currently preparing to put up these mega-refineries, which can threaten refinery operations in nearby countries like Singapore, Almendras said yesterday before the House energy committee.

When these mega-refineries start operating, the Chinese will profit from ?economies of scale.? By then, it may be cheaper for the Philippines to export crude oil and have it refined in China, before importing back the final petroleum products, he explained.

As a result, ?one of the country?s two refiners would pull out because it would be a lot cheaper to do so,? the energy chief said.

But Almendras declined to identify which of the two refiners in the country?Petron Corp. and Pilipinas Shell Petroleum Corp.?would likely fold.

Petron currently owns and operates the 180,000-barrel-a-day refinery and petrochemical facility in Bataan, while Shell has a 110,000-barrel-a-day refinery in Tabangao, Batangas.

Both, however, are not running on full capacity.

Almendras said the ?escalating? costs of operating these refineries could be the trigger that would push one of these two companies to scrap refinery operations.

One company, he added, has already explained to the Department of Energy the economic difficulties of maintaining its refining operations here in the Philippines. Company officials said that would be cheaper to just import finished petroleum products.

?Even if we made [refining] a priority, nobody will do it because the costs will go against us. We do not have enough volume that can compete with the efficiencies of refineries in Singapore, South Korea, Japan and soon, China,? Almendras said.

?Even the other countries are worried about China?s play because if [it] becomes the mega-refiner, we will have no choice [but to import from them].?