Despite falling oil prices, Petrovietnam’s revenue peaks in October

Chia sẻ

(VOVWORLD) - The Vietnam National Oil and Gas Group (Petrovietnam) recorded the highest revenue in October as compared to other months since the beginning of the year, helping the group operate in the black and accomplish assigned financial targets in 2023 to mid-November. This was confirmed by General Director of Petrovietnam Le Manh Hung during a regular briefing in November with leaders of the Group's member units the review the production and business activities in October, the first 10 months of the year and plans for the rest of the year.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 1The regular briefing in November of leaders of the Vietnam National Oil and Gas Group Group's member units to review production and business results in October, 11 months and plans for the rest of the year (Photo Petrovietnam)

Efforts to overcome difficulties, October revenue exceeded 44% of the plan

In October, the Israel-Hamas conflict continued to further intensify the already difficult geopolitical situation in the first 9 months of the year. The global Purchasing Managers Index (PMI) in October reached 48.8 points, down 0.3 points compared to September and was the 14th consecutive month recording below 50 points. Except for the US, the PMI index of most major economies is below 50 points, especially the European region that recorded the weakest recovery. This shows that global production continues to be gloomy with no breakthrough and is likely to continue in 2024.  Though inflation has decreased,  public debt has increased, the recent economic growth is forecast to be lower that the previous forecasts.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 2Participants join the meeting online (Photo Petrovietnam)

Recently, domestic socio-economic indicators have improved, confidence in the economy's resilience is gradually strengthening, but the most recent forecasts show that economic growth continues to be difficult, especially in the manufacturing sector, with concerns about business prospects in the context that world consumer demand has not really recovered.

Besides, the Oil and Gas industry was affected, oil prices in October decreased compared to September, the average prices of petroleum products in October decreased by 4% - 10% compared to September; plummetted defining profit margins, low gas mobilization for electricity production, difficult gas and LNG consumption. Gas power mobilization is also very low, affecting the operational efficiency of power plants. Fertilizer consumption is difficult due to oversupply and slower growing season compared to the same period last year.

According to Pham Van Phong, General Director of PV GAS, the power sector's gas consumption is forecast to decrease by about 18% in 2023 as compared to 2022 and continue to decline in 2024, thus affecting production. PV GAS's total gas volume ashore in 2024 is estimated to be only about 6.3 billion cubic metres, much lower than the expected 7.7 billion cubic metres for 2023. Along with that, mechanisms to supply liquefied natural gas (LNG) for electricity production is extremely difficult. Predictions for 2024 reveal it will still not be possible to sell LNG for the power sector.

Petrovietnam has made enormous efforts to maintain production and business activities to achieve positive business results compared to September.

In October, Petrovietnam's production output targets were all completed beyond the monthly plan. In particular, with stable petroleum production and high growth, the Group has taken advantage of market opportunities, optimized maintenance cycles, to ensure Dung Quat Oil Refinery operates safely, stably for the past 38 months, contributing to increasing production and business efficiency and stabilizing the petroleum market. Ca Mau Fertilizer Plant continues to operate at a high level and is expected to exceed the peak in 2022.

Specifically, oil output in October reached 0.85 million tonnes, exceeding the monthly plan by 4.2%.

In the first ten months of this year, the group tapped 8.7 million tonnes of oil, surpassing the 10-month target by 13.1%. The total gas production in October reached 0.62 billion cubic metres, exceeding the monthly plan by 4.6%. For 10 months overall, output reached 6.38 billion cubic meters, 9.7% higher than the plan. The electricity production reached 1.91 billion kWh in October and 19.54 billion kWh in 10 months, up 2.4% and 1.7% from respective plans, respectively.

The fertiliser production in October stood at 161.800 tonnes, or 9.6% higher than the set goal. It reached 1.46 million tonnes in 10 months, topping the plan by 5.9%. Meanwhile, the petrol production, excluding the products of Nghi Son refinery and petrochemical company, reached 6.08 million tonnes, or two months ahead of schedule, up 5.9% annually.

The group’s total revenue was estimated at 745 trillion VND (31 billion USD) in 10 months, surpassing the annual plan by 10%. Its contribution to the State budget topped the target by 54% to 121 trillion VND.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 3Deputy Prime Minister Tran Luu Quang and delegates cut the ribbon to inaugurate Thi Vai Liquefied National Gas (LNG) warehouse (Photo Petrovietnam)

On October 30, Petrovietnam and its partners signed contracts and launched the Block B - O Mon gas-to-power project chain, marking a crucial milestone for this chain that has been ongoing for nearly two decades. As the largest of its kind in Vietnam, the chain is expected to produce 5.06 billion cu.m of gas per year during the stable phase, providing supply to four O Mon thermal power plants in Can Tho with a total installed capacity of nearly 4,000 MW. Those contracts play a very important role in the strategy of balancing supply and demand, ensuring national energy security, green energy conversion and socio-economic development.

On October 29, Petrovietnam and PV GAS inaugurated the Thi Vai liquefied natural gas (LNG) port with an annual capacity of 1 million tonnes, which is also the first and largest LNG port in Vietnam, marking a breakthrough for Petrovietnam in successfully implementing product diversification, new energy, market expansion in the global energy transition trend, meeting the goal of ensuring energy security, transforming to green national energy source.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 4General Director Le Manh Hung checks the progress of Nhon Trach 3 and 4 Power Plant projects (Photo Petrovietnam)

Previously, on October 12 and October 16, 2023, PV Power and the general contractors put the generator and turbines of Nhon Trach 3 Power Plant into the foundation. This milestone was very important for the country's first LNG power project, to ensure the progress of commercial power generation (COD) of Nhon Trach 3 Power Plant in the fourth quarter of 2024 and Nhon Trach 4 Power Plant in the second quarter of 2025.

Consistent with management goals, proactively responding to market fluctuations

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 5Prime Minister Pham Minh Chinh witnesses the signing ceremony to deploy Block B - O Mon gas power project chain (Photo Petrovietnam)

Chairman of the Board of Members of Petrovietnam Hoang Quoc Vuong emphasised that the Prime Minister has recently approved the group’s restructuring project until 2025. The chairman said that after the recent important step in the Block B-O Mon gas-to-power chain project, units participating in the project need to deploy and monitor progress. For units that have not yet completed their production and business plans assigned by the group’s board of members, they must continue making efforts in the remaining months of the year.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 6Petrovietnam leaders report to Prime Minister Pham Minh Chinh about the Block B-O Mon gas-to-power chain project (Photo Petrovietnam)

However, there are still many difficulties and challenges to overcome in the coming time such as: mobilizing gas, electricity, ensuring exploitation output, and output for petrochemical products, etc. Regarding the production plan for the rest of the year and plans for next year, General Director Le Manh Hung emphasized 5 practical management: (i) defining clear goals; (ii) having a very specific and meticulous plan; (iii) immedidate implementation without urgency; (iv) regular control and adjustment; (v) consistent to achieve the goals. Petrovietnam continues to be steadfast in the management goals set out at the beginning of the year, especially expanding scale and increasing revenue to create momentum for regenerating the business model.

Petrovietnam continues to be consistent in the management goals set out at the beginning of the year, especially expanding the scale and increasing revenue to create momentum for regenerating the business model.

Despite falling oil prices, Petrovietnam’s revenue peaks in October - ảnh 7Engineers on Su Tu Trang (White Lion) oil field (Photo Petrovietnam)  

Concluding the meeting, Hung highlighted specific tasks in the coming time, including regularly updating and forecasting macroeconomic and market conditions to plan and manage operations effectively, increasing production capacity, ensuring operational safety and usability of power plants and electricity output to contribute to power supply for the economy, flexibly manage production, inventory, and business operations, reviewing and controlling cash flow safety.

He called for continuing to improve the internal management system, especially processes, regulations, and rules; and dealing with issues in accordance with the conclusions of the State Audit Office; completing the 5-year plan and the 2024 plan, while setting comprehensive management objectives from the beginning of next year.

In particular, he suggested establishing a steering committee in charge of implementing the Petrovietnam’s restructuring scheme for the 2021-2025 period recently approved by the PM.

The committee must thoroughly analyse the restructuring work for each sector and area, assign specific tasks, and propose concrete solutions to successfully accomplish the set goals.