Puma Energy's disciplined strategy for a volatile market

Latin America and the Caribbean's fuel thirst coupled with growing demand for cleaner and innovative products has created new business opportunities.

BNamericas spoke to Rodrigo Zavala, Puma Energy's Americas COO, to learn what markets the company has its sights on.

BNamericas: What is Puma's Latin America strategy for the coming years?

Zavala: Puma Energy is always in search of new growth opportunities. Our objective is to continue expanding the portfolio of products in the Americas and to take advantage of the multiple opportunities we identify in new markets through strategic acquisitions and organic growth.

Proof of that is our recent entrance into the Peruvian market where Puma Energy acquired 100% of shares in Peruvian oil company Ferush. The acquisition includes all its assets, sales and distribution installations. With this acquisition Puma Energy enters the competitive Peruvian market, increasing its presence in the Americas to 11 markets.

We also are placing products that add value to markets with high demand: bitumen, liquid petroleum gas, lubricants, and aviation and marine fuel.

BNamericas: What are some drivers behind Puma's expansion in the region?

Zavala: In the Americas, we have entered markets that have greater demand for oil products and are in rapid growth. Today, we have operations in 11 countries in the region: Guatemala, Puerto Rico, US Virgin Islands, Belize, Panama, Colombia, Paraguay, Nicaragua, Honduras and El Salvador, and recently we entered Peru.

BNamericas: What products have seen the greatest growth in the region and which ones will lead in the coming years?

Zavala: We continuously seek innovative products to offer better quality service that satisfies the needs of the consumer, setting market trends.

In 2012, we introduced in our offer the exclusive ultra low sulfur diesel ION Puma Diésel, and today we are the only ones in the fuel industry that distribute it in our service station network in Puerto Rico, Guatemala and El Salvador.

We have been positioning ourselves strongly in the aviation market. In the last three years Puma Energy has become a reliable supplier of jet fuel and avgas, becoming a leader for aviation in Central America, as well as in other markets of Latin America where it operates. Currently we supply 53 airports around the world, seven of which are in the Americas.

In mid-2015, we purchased BP's aviation operations in Puerto Rico, becoming the fuel supplier for the Luis Muñoz Marín international airport in San Juan, which serves over 4mn passengers a year.

We are very interested in investing and improving infrastructure to offer quality products in an agile and competitive manner. Also in 2015, Puma Energy invested around US$30mn in Paraguay to build a new plant in San Antonio to improve supply to the market and our industrial clients and also to guarantee the delivery of quality jet fuel and avgas, on time and to the required standards.

Thanks to this investment in infrastructure, we have been able to win over 40 new clients in the Paraguayan market.

BNamericas: What is your outlook in terms of increasing natural gas use in the region, for example LNG to Central America, and how does this come into play with Puma's plans?

Zavala: We are investing strongly in Puerto Rico to introduce our offer of liquid petroleum gas in all segments. In the case of Central America, we have been selling in Nicaragua in the cylinders market and we do not rule out other markets.

BNamericas: How has the oil price slump impacted Puma's operations and planning in the region?

Zavala: We have been able to develop a robust and successful business model. Part of our success is the result of geographic diversification. We have operations in the Americas, Africa, Europe, the Middle East and Asia.

We have focused on markets with the greatest growth and countries with high demand for fuel or oil infrastructure where we can make a difference. We have developed strategies that protect us from the volatility of the market and we conduct continuous analysis to anticipate market trends.

This way of doing business not only has resulted useful for Puma Energy but also for our clients, to whom we can offer a global integrated supply that guarantees high-quality fuel all over the world in a safe, rapid, reliable and competitive manner.

BNamericas: What other commercial and operational challenges has Puma faced in the region?

Zavala: The businesses where Puma Energy operates are very dynamic and constantly changing which obliges us to be very disciplined in the way we monitor, analyze and adapt our strategy to protect ourselves from the volatility of the market.

Fortunately the business model of Puma Energy has been successful and we continue its expansion across the continent.