PVN posts encouraging results despite crises

10:00 | 25/09/2020 Companies

(VEN) - During the first eight months of 2020, while the world’s leading oil and gas groups have suffered losses, the Vietnam National Oil and Gas Group (Petrovietnam or PVN) has sustained its production and business pace, exceeding the oil and gas exploitation plan by 5.3 percent, and contributing more than VND44 trillion to the state budget.

pvn posts encouraging results despite crises
PVN leaders present a souvenir to Deputy PM Truong Hoa Binh

The results were reported by Politburo Member and Deputy Prime Minister Truong Hoa Binh at a September 10 working session with the group’s leaders marking the 45th anniversary of PVN’s founding.

pvn posts encouraging results despite crises
Deputy PM Truong Hoa Binh speaks at the working session
pvn posts encouraging results despite crises
PVN General Director Le Manh Hung reports on the production and business operations of the group

According to a report delivered by PVN General Director Le Manh Hung at the event, the 2015-2020 period presented PVN with major challenges. The oil price crises from 2015 to 2018 and especially the “dual crisis” from the beginning of this year due to the Covid-19 epidemic and low oil prices have negatively affected the group’s operations.

Nonetheless, PVN still achieved encouraging results, making important contributions to the economy.

In the first eight months of 2020, production targets such as crude oil and gas exploitation and fertilizer production met the set plan, but the electricity and petroleum production targets have faced difficulties due to reduced market demand.

During this period, the total group revenue reached VND372.02 trillion (equal to 50 percent of the year’s plan); total state budget payment reached VND45 trillion (or 55 percent of the year’s plan). These are impressive results given that PVN’s 8-month average price was only US$44.2 per barrel, much lower than the target price and the price of the same period last year. The business results ensured uninterrupted cash flows for the group and its member units, contributing to sustaining production and business activities. Various steps have saved the group more than VND6.52 trillion in operating costs, equal to 70.1 percent of the set plan.

General Director Le Manh Hung said the results stem from the group’s implementation of solutions for problems in administration, finance, investment, market and policy mechanisms.

Positive international rating

PVN’s restructuring since 2018 has had recognizable results. The number of major departments/offices decreased from 33 to 18, while the number of smaller departments dropped from 73 to 51, contributing to improved efficiency. The group also issued a new set of internal administration rules and digitized risk management operations. These efforts have yielded a BB+ rating for PVN by Fitch Ratings, the world’s leading rating organization.

In addition, PVN’s equitization and restructuring yielded more than VND16.44 trillion, about half of which, nearly VND7.35 trillion, was paid into the state budget. All listed units for the 2017-2020 period were equitized, including PetroVietnam Power Corporation (PVPower), PetroVietnam Oil Corporation (PVOIL) and Binh Son Refining and Petrochemical Joint Stock Company (BSR). They have completed registration for share trading on the Upcom/HSX trading floor.

PVN, valued at US$40 billion, has become a strong oil and gas corporation in the country and the region, employing nearly 60,000 workers, many of them are skilled experts who can meet international requirements and replace foreign experts in technical and managerial work.

PVN will follow the Deputy PM’s directions, responding in timely fashion to market developments in order to achieve socioeconomic development targets in 2020 and the following years.

Manh Chung