In May 2023, in the context of the global and national economy being extremely difficult, severe weather with record heat across a wide area causing power shortages, declining production... the production and business activities of the Vietnam Oil and Gas Group (Petrovietnam) remained safe and stable, especially the production and supply of key products such as gas, electricity, and gasoline with impressive growth momentum, thereby contributing to reducing the pressure on electricity supply, ensuring national energy security, and making an important contribution to the budget.
Overview of the meeting.
Electricity production increased by 48% over the same period, revenue exceeded the plan by 20% in the context of sharp decline in oil prices
On June 12, Petrovietnam General Director Le Manh Hung chaired a regular meeting in June 2023 with heads of units in the Group to assess the implementation of the production and business plan in May and the first 5 months of the year; deploy plans for June and the following months.
In May, the global and domestic macro situation showed that global production continued to decline. The global PMI index continued to be below 50 points, remaining at 49.6 points for 3 consecutive months, especially the PMI of major economies such as the US, EU, and China in May all decreased compared to April; high interest rates hindered economic growth, inflation remained high, and growth rate was weak.
Online bridges.
Domestically, the manufacturing PMI also fell to 45.3 points in May from 46.7 in April, marking the third consecutive month of decline and the most significant decline since September 2021. In addition, the situation of power shortages, low credit growth, and shrinking exports, especially in large markets, shows that business operations of enterprises are facing many difficulties, especially for large enterprises in the manufacturing sector such as Petrovietnam.
In addition, in May, the price of crude oil and petroleum products continued to decrease, affecting the production and business efficiency of the Group as well as its member units. The average crude oil price in May 2023 decreased by 11% compared to the average of April and decreased by 7% compared to the average of the first quarter of 2023, and decreased by 33% compared to the same period in 2022. Oil refining profit margins, gas prices, fertilizer prices, gasoline prices, etc. all decreased.
Petrovietnam and PV Power power plants strive to ensure electricity supply for the economy and life.
In that context, with the effort to increase production to partly offset the losses from fluctuations in energy prices, limit negative impacts from the macro situation and market, and effectively take advantage of opportunities, Petrovietnam has exceeded its production and business plan; contributing to the supply of strategic products: gas, electricity, fertilizer, gasoline, etc. for the economy.
In May and the first 5 months of the year, the Group's production targets all exceeded the plan, especially in May, which recorded positive growth, contributing to stabilizing and ensuring national energy security.
Specifically, crude oil production in May 2023 reached 0.92 million tons, exceeding the monthly plan by 15.6%, up 2.6% compared to April 2023, equal to the same period in 2022; in the first 5 months, it reached 4.41 million tons, exceeding the 5-month plan by 13.8%.
Of which, domestic crude oil exploitation in May 2023 reached the highest level since the beginning of the year, reaching 0.77 million tons, exceeding the monthly plan by 18.4%, up 3% compared to April 2023, up 1.1% over the same period in 2022; the total for 5 months reached 3.66 million tons, exceeding the 5-month plan by 16.3%. Overseas crude oil exploitation in May 2023 reached 149.5 thousand tons, exceeding the monthly plan by 3.1%, up 0.9% compared to April 2023; the total for 5 months reached 751.6 thousand tons, exceeding the 5-month plan by 2.6%.
Dai Hung mine cluster.
In early June, the PetroVietnam Exploration and Production Corporation (PVEP) tested the Dai Hung Nam - 4X well and gave very positive results. The test results at 12:20 p.m. on June 8, 2023 showed that the well had good oil and gas performance with a maximum test flow of about 6,350 barrels of oil per day and 4.5 million cubic feet of gas per day.
With such flow, it is affirmed that the potential of Dai Hung Nam area is commercial enough and ready to be exploited. This is also the premise for PVEP to continue to develop and exploit Block 05.1(a) as well as other blocks in the Nam Con Son basin, continuing to contribute to Petrovietnam's oil and gas production in the coming time.
Petrovietnam's gas production output in May 2023 reached 0.75 billion m3, exceeding the monthly plan by 27.6%, up 2.8% compared to April 2023, up 6.8% over the same period in 2022; the total for the first 5 months reached 3.44 billion m3, exceeding the 5-month plan by 21.8%. The average daily gas production output in May is also the highest level since the beginning of the year.
Nitrogen production in May 2023 reached 158.4 thousand tons, exceeding the monthly plan by 5.5%, up 53.8% compared to April 2023, up 3.8% over the same period in 2022; in the first 5 months, it reached 719.5 thousand tons, exceeding the 5-month plan by 11.1%.
Petroleum production (excluding NSRP products) in May 2023 reached 570.2 thousand tons, exceeding the May plan by 14.4%; in the first 5 months, it reached 2.92 million tons, exceeding the 5-month plan by 13.3%, up 4.7% over the same period in 2022.
In particular, when there was a shortage of electricity for production and daily life, especially in May, Petrovietnam made efforts to provide maximum fuel for electricity production, optimize the operation of the Group's power plants to increase supply to the system, contributing to reducing the pressure on electricity supply.
The Group's electricity production in May 2023 reached 2.36 billion kWh, up 12% compared to April 2023, up 85.5% over the same period in 2022; the total for the first 5 months reached 10.12 billion kWh, up 48% over the same period in 2022.
Flame from DHN-4X with self-jetting oil stream.
In May 2023, the total mobilized electricity output of the Group reached an average of 75.5 million kWh/day, an increase of 5.3 million kWh/day (equivalent to an increase of 7.5%) compared to the level of April 2023.
In particular, the average output in May 2023 of PetroVietnam Power Corporation (PV Power) alone reached 51.5 million kWh/day, an increase of 5.9 million kWh compared to the average in April 2023; at the same time, in an effort to contribute to reducing the electricity shortage in the North, Thai Binh 2 Thermal Power Plant has also operated at 100% capacity.
With high-speed production efforts, Petrovietnam's financial indicators in the first 5 months of the year also exceeded the plan, making an important contribution to the economy. Total revenue of the Group is estimated at 334 trillion VND, exceeding the 5-month plan by 20%. The total State budget contribution of the Group (excluding NSRP) is estimated at 54.5 trillion VND, exceeding the 5-month plan by 45%. Consolidated pre-tax profit is estimated at 21.7 trillion VND, exceeding the 5-month plan by 63% and equal to 63% of the 2023 plan.
This result is also much more positive than the decline in oil prices. Petrovietnam's average oil export price in May 2023 decreased by 7% compared to the oil price in April 2023 and decreased by 27.7% compared to the same period in May 2022. On average, oil prices in the first 5 months were 18.4% lower than the same period in the first 5 months of 2022.
Linking production and business goals with the country's common goals
Speaking at the meeting, Chairman of the Board of Directors of Petrovietnam Hoang Quoc Vuong emphasized that, in order to fulfill the Prime Minister's expectations, the entire Group must strive to make greater efforts and successfully complete the set management plan targets, to partly compensate for the difficulties that the country's economy is facing.
Petrovietnam Chairman of the Board of Directors Hoang Quoc Vuong also directed issues related to the implementation of the Block B - O Mon gas project, as well as component projects in the chain to ensure the progress targets of this very important project.
PVOIL ensures gasoline supply.
After listening to reports, discussions and instructions for each unit and field of operation of the Group; at the same time accepting the direction of Chairman of the Board of Directors Hoang Quoc Vuong, concluding the meeting, General Director of Petrovietnam Le Manh Hung emphasized: “The Prime Minister has repeatedly directed that the goals of state-owned enterprises must be linked to the common goals of the country. Therefore, the entire Group must thoroughly grasp this direction, closely follow and serve the common goals. Especially in the current difficult economic context, the role of state-owned enterprises is very much needed”.
Petrovietnam General Director Le Manh Hung also noted some other contents that need to be focused on in the coming time such as: The Group and its member units need to review and update targets, allocate targets for implementing plans in the following months. Implement production and business plans, management to ensure maintenance and growth of production output, especially in the fields of oil and gas exploration and exploitation, petrochemical refining, gas industry, and electricity industry. Review investment work, manage investment portfolio, create changes, increase the proportion of investment capital disbursement. Focus on implementing and promoting large, key projects: Lot B - O Mon, Dung Quat Oil Refinery Upgrade and Expansion, Nhon Trach 3 and 4 Power Plant Project, ... to ensure balance of capital and cash flow for projects.
Develop a plan to organize a Conference on service work in June, evaluate, propose plans, goals, and solutions for this field. Strengthen chain connections, review existing chains and deploy new chains to promote the strength of the Petrovietnam ecosystem; Improve the management system, review, and update according to new legal regulations...
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