PetroVietnam leaders and employees donate and give gifts to people affected by storm No. 3 (storm Yagi)

Recognizing the challenges and difficulties in the general trend of the world, the Vietnam Oil and Gas Group (PetroVietnam) has strived to find new motivations and solutions, continuously maintaining positive production and business results in the first 8 months of 2024.

Revenue exceeded 34% of 8-month plan

In August, the world economy continued to grow slowly, facing challenges of interest rates, inflation and warnings of unstable factors. Sharing the same pressure of the world economy, the Vietnam Purchasing Managers' Index (PMI) in August decreased by 2.3 points compared to July, to 54.7 points, but overall, the macro picture remained optimistic. Regarding the market, commodities affecting the Group's production and business activities such as oil and gas prices tended to decrease in August. In contrast, LNG and gas prices increased at a positive level, but the mobilization of electricity and gas continued to be low...

Faced with market challenges and opportunities, PetroVietnam has strived to deploy effective management and operational solutions to take advantage of opportunities, minimize adverse impacts, and continue to record positive production and business results, along with many important events and milestones. In August 2024, most of PetroVietnam's key production targets exceeded the monthly plan by 6.3 - 28.2%. In the first 8 months of 2024, most of PetroVietnam's production targets exceeded the plan by 2.7 - 29.2%, an increase of 2.5 - 26.8% over the same period in 2023.

The Group has closely coordinated with the Central Economic Committee to complete the content and successfully organize the "Conference to disseminate and implement Conclusion No. 76-KL/TW dated April 24, 2024 of the Politburo" on August 21, 2024 as a basis for implementing related tasks and focusing on coordinating with ministries and branches to develop mechanisms and policies to facilitate PetroVietnam's development according to the guidelines of Conclusion No. 76-KL/TW and Resolution No. 41-NQ/TW and to develop a strategy for the development of the oil and gas industry/Vietnam Oil and Gas Group with the goal of becoming a national industrial - energy group.

On August 28, 2024, Vietnam Oil and Gas Technical Services Corporation (PTSC) and its partner Sembcorp Utilities Pte. Ltd. (SCU) of Singapore held a Bid Award Ceremony for the Wind Measurement, Hydrology and Geological Survey Package, Offshore Renewable Energy Export Project from Vietnam to Singapore.

Recently, PetroVietnam Gas Corporation (PV GAS) successfully transported the first LNG shipment by rail from the South to the North with 16 LNG tanks and began supplying to customers from September 11, 2024.

Regarding production targets, the Group's crude oil output in August reached 833 thousand tons, exceeding the monthly plan by 28.2%. The cumulative output in the first 8 months reached 6.64 million tons, exceeding the 8-month plan by 20.2%. The Group's gas output in August and the first 8 months of the year reached 450 million m3, exceeding the monthly plan by 19.7% and 4.41 billion m3, exceeding the 8-month plan by 29.2%. The Group's electricity production in August reached 2.01 billion kWh, up 11.4% compared to July; the cumulative output in the first 8 months reached 19.23 billion kWh, up 20.1% over the same period.

Thanks to positive production and business growth, the Group's total revenue in the first 8 months is estimated at VND 650.4 trillion, exceeding the 8-month plan by 34%, up 13% over the same period in 2023; The Group's budget contribution is estimated at VND 96.5 trillion, exceeding the 8-month plan by 49%, up 7% over the same period in 2023. The Group's consolidated pre-tax profit is estimated at over VND 35.5 trillion, exceeding the 8-month plan by 84%.

In addition to its business results, PetroVietnam has also actively contributed to social security with the value of social security implementation in the past 8 months being 469 billion VND. PetroVietnam has also promoted the spirit of oil and gas culture, actively supporting and assisting people affected by storm No. 3 and the storm's aftermath. The amount of contributions mobilized to date has reached approximately 40 billion VND.

Efforts to add new incentives

In the first 8 months of the year, PetroVietnam's operating sectors/fields continued to make many efforts to add new driving forces, aiming to achieve the highest governance target in 2024.

PetroVietnam Exploration and Production Corporation (PVEP) forecasts that exploration and reserve increase will exceed the set plan. Mine development and new projects are actively implemented.

In the Gas - Power - Fertilizer sector, PV GAS representative informed that the onshore gas output decreased due to low electricity mobilization. However, the non-electricity gas business grew quite well, PV GAS has also just added LNG products to the Northern market. International business also achieved positive growth. In the coming time, PV GAS will continue the plan to expand gas consumption outside of electricity, further promoting the new driving forces of the enterprise.

The oil and gas service sector shows a positive situation. A representative of PTSC said that the company's revenue and profit growth is expected to exceed 5% and 9% compared to the same period in 2023. PTSC currently has many large contracts in domestic projects, and the proportion of domestic revenue is expected to increase in 2024.

Regarding the service, finance and insurance sector, PVI Holdings said that it has received nearly 600 requests for compensation for storm and flood damage, with an estimated liability as the original compensation provider of about VND 2,400 billion and is expected to increase in the coming time. In recent days, PVI Holdings has mobilized all resources to support customers, ready to receive and process loss records, minimizing time for customers.

Successful installation of BK-23 platform topside block. (Source: PVN)

PetroVietnam and its member units also actively contributed to perfecting the policy mechanism for operations such as: giving comments on the draft Electricity Law (amended) with a mechanism for LNG electricity to minimize investment risks for businesses; issues related to value added tax on fertilizer products to create fair competition with foreign businesses.

Macroeconomic optimism amid challenges

Evaluating the Group's production and business activities in August and the first 8 months of the year, PetroVietnam General Director Le Ngoc Son commended and acknowledged the efforts of member units that contributed to the Group's total revenue, up 13% over the same period; State budget contribution exceeded 7% over the same period.

In particular, General Director Le Ngoc Son praised the units for completing the management plan for revenue and profit. PV GAS was also praised for actively seeking new drivers for growth. PetroVietnam General Director acknowledged the positive macroeconomic outlook for the country, with the prospect of GDP growth of 6-6.5% for the whole year. The Government has had many breakthrough mechanisms and policies to remove difficulties and obstacles for businesses.

However, General Director Le Ngoc Son also commented that the difficulties from the world economic situation and the consequences of storm No. 3 in the country are major obstacles. Those difficulties will be challenges to the completion of the Group's 2024 management plan. Therefore, PetroVietnam must focus on building a risk management plan, while at the same time having appropriate allocations for the implementation of the plans of member enterprises and each specific field.

General Director Le Ngoc Son directs cash flow risk management, handles outstanding issues such as debt, increases charter capital, and dividends; reviews and promotes investment disbursement, and more clearly assesses subjective causes to find solutions; focuses on building industry development strategies, Group development, digital transformation strategies, and science and technology.

PetroVietnam leaders also noted the development of production and business plan targets for 2025, emphasizing that this is a pivotal year in the Group's operations, the final year of implementing the 5-year plan 2021 - 2025, entering a new phase with the highlight of celebrating the 50th anniversary of the Group's founding, organizing Party congresses at all levels, so it is necessary to have a thorough preparation plan soon.

Along with social and community responsibilities, General Director Le Ngoc Son also noted that leaders of units need to focus on supporting units and oil and gas workers affected by the recent storm and flood.