VietNamNet Bridge - The average oil price in the first half of 2016 fell nearly $20 to $40.5 a barrel, causing the sales of the Vietnam National Oil and Gas Corporation (PetroVietnam) to fall by VND85,000 billion (nearly $4 billion) over the same period.


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PetroVietnam announced its business results in the first 6 months of 2016. According to the report, the oil output reached 14.57 million tons, 1.1 million tons (8.2 %) more than the 6-month plan.

PetroVietnam also manufactured and supplied 10.74 billion kWh of power to the national grid, produced 826,500 tonnes of nitrogenous fertilizer and 3.38 million tons of petrol, 15.8% more than the plan.

Despite the increase of output of some product, PetroVietnam's revenue in the first half of 2016 reduced compared to the same period of 2015 due to the fall of crude oil prices on the international market (average price of $40.5 a barrel, down by $20 over the same period of last year).

PetroVietnam’s revenue during this period is VND215,600 billion, below the plan and reducing by VND85,000 billion (nearly $4 billion) compared with the same period of 2015.

Of this, revenue from oil reached VND60,300 billion and VND82,800 billion from petroleum products, electricity, and gas.

In addition, its service units also collected VND72,400 billion. Profit after tax is estimated at VND10,500 billion.

It is forecast that the average oil price of PetroVietnam in the second half of the year will fluctuate between $45-50 a barrel and $45 on average for the year.

Therefore, the Group planed to exploit 25.64 million tons of oil in 2016, earning revenue of VND514,500 billion, a total investment of VND78,000 billion.

If the oil price remains at the current low level of $40, PetroVietnam may fail to accomplish the plan.

 

PetroVietnam to boost crude oil production with additional drilling

PetroVietnam will increase its drilling activities to produce an additional one million tonnes of crude oil in 2016, according to PetroVietnam General Director Nguyen Vu Truong Son.

An additional four or five oil wells will be drilled in Su Tu Nau (Brown Lion) oil field in Block 15-1, Rong (Dragon) oil field in Block 09-1 and Te Giac Trang (White Rhino) oilfield in Block 16-1.

Along with optimising its operation to increase output from current wells, the Group will use an acid treatment process at the base of the oil wells to increase the recovery factor for oil and branch out Su Tu Trang (White Lion) phase 1 field.

Son said that PetroVietnam will work with its contractors in July to discuss measures to fulfill the targeted oil exploitation plan.

A sharp decrease in oil prices since 2014 has been a major hindrance for oilfield enlargement. Investors have had to halt the development of new oil fields and cut down the costs for oil drilling.

PetroVietnam said that there is a considerable fall in the number of oil and gas projects becoming operational in 2016, with only 58 new oil wells, including 31 domestic and 27 other wells in foreign countries. And so, it will be difficult to maintain this year’s crude oil output at 2015’s level. VNA

Nam Nguyen