Petrovietnam posts profit surge of 77% from four-month target

Despite oil price declines, the Vietnam Oil and Gas Group (Petrovietnam) posted 18.2 trillion VND (775.5 million USD) in consolidated pre-tax profit in the first four months of 2023, surging 77% from its target for the period and equivalent to 52% of this year’s plan.
Petrovietnam posts profit surge of 77% from four-month target
A view of the Dung Quat Refinery in Quang Ngai province. (Photo: VNA)

Its four-month revenue was estimated at 262.2 trillion VND while contribution to the state budget, excluding payment by the Nghi Son Refinery and Petrochemical LLC, was about 36.6 trillion VND, respectively rising 21% and 16% from the targets for the period.

At the firm’s recent meeting on May operations, General Director of Petrovietnam Le Manh Hung said that the global economy encountered numerous difficulties and challenges in the first four months of 2023, including high inflation, growth slowdown, increased risk of financial system failures, and shrunken consumption demand. Meanwhile, the domestic economy has also struggled, leading to slower growth of macro-economic indexes compared to the same period last year.

Aside from negative impacts from the world and domestic situation, falling oil prices have also considerably affected production and business activities of Petrovietnam, he went on.

Its average crude oil price in April dropped by over 17.1 USD per barrel, or nearly 16%, from a year earlier. In addition, natural gas prices remained low amid oversupply, electricity prices increased by 3% but yet to match the surge of input prices, while both fertiliser prices and demand were also low.

In such context, Hung noted, the group has taken measures to minimise losses caused by adverse factors, especially low prices, and make use of opportunities to increase revenue and profit. As a result, its operations last month were relatively stable and more positive than March.

In particular, oil and gas mining in April was better than in previous months. The firm’s crude oil volume exploited in Vietnam was equivalent to that in the same period last year while the volume exploited abroad approximated the figure in April 2022.

The Dung Quat refinery, based in the central province of Quang Ngai, maintained high production capacity, equivalent to 106 - 114% of its designed capacity, helping guarantee energy security and stabilise the domestic fuel market.

In the first four months, Petrovietnam surpassed all of its main production targets for the period, including crude oil exploitation up 15.3%, gas exploitation 20.3%, fertiliser production 12.8%, petrol and oil production 13%, and electricity generation 4.6%, statistics show.

On April 27, it inaugurated the Thai Binh 2 thermal power plant, expected to generate 7 - 7.2 billion kWh for the national grid each year and raise the total capacity of its power plants that have been put into operation to 6,605MW, accounting for some 8.5% of the total electricity generation capacity nationwide.

Hung added that one of the bright spots of Petrovietnam in the four months was that its affiliates in the service sector posted stable growth and are forecast to maintain such positive results in the coming months.

Addressing the meeting, Petrovietnam Chairman Hoang Quoc Vuong stressed the three focal tasks to be promoted in the following months, including maintaining exploitation volumes, guaranteeing stable power plant operations to serve socio-economic development demand, and solving investment procedures to step up key projects such as Block B gas projects and the Nhon Trach 3 and 4 power plants.

General Director Hung predicted that in the coming months, the group will continue to struggle with macro-economic difficulties, global economic recession risks, and especially oil and gas price volatility. Given this, it will push for the fine-tuning of relevant mechanisms and policies, including the draft revised Law on Bidding, the draft decree that will replace the Government’s Decree 124/2017/ND-CP on overseas oil and gas investment, and the draft decree guiding the enforcement of the Petroleum Law.

Its member units will focus efforts on dealing with the declines in production volumes and revenue at the companies making up large proportions of the group’s revenue, and developing key products and services.

Besides, Petrovietnam will step up long-term scientific studies and digital transformation, he added.

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(Source: VNA)