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PetroVietnam – 8 Impressions of 2022

27/06/2023

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2022 marks the third year in which Petrovietnam has achieved remarkable results in its “Volatility Management” efforts, which have become a crucial factor in determining the overall outcomes of the company’s production and business activities. Petrovietnam has successfully implemented various solutions to effectively navigate geopolitical and economic fluctuations, resulting in the attainment of significant milestones and records. These achievements serve as a driving force and instill confidence in Petrovietnam’s ability to maintain stable and sustainable development while continuing to expand its reach

1. Volatility management has become the corporate governance culture of Petrovietnam, creating impressive achievements

Ca Tam 02 rig, one of 05 new oil and gas fields/projects to be put into operation in 2022

All tasks and targets of the entire Group have experienced significant growth compared to 2021, serving as a driving force for expansion, providing valuable lessons, and instilling a pervasive belief in Petrovietnam’s ability to develop sustainably.

Petrovietnam successfully put 5 new oil and gas fields/works into operation, exceeding the annual plan by 1 work and surpassing the number of fields/works put into operation in 2021 by 2 (in 2021, only 3 fields/works were put into operation). This achievement highlights the Group’s commitment to expanding its operations and increasing its production capacity.

Additionally, there has been a substantial increase in oil and gas reserves, oil and gas exploitation, protein and electricity production, and petroleum production and business, ranging from 3% to 26% compared to 2021. This growth signifies the Group’s ability to effectively harness its resources and drive progress across various sectors.

Furthermore, for the third consecutive year, Petrovietnam has achieved a BB+ rating from Fitch Ratings. This recognition reflects the Group’s strong financial performance and solid standing in the market.

2. Overcoming difficulties, taking advantage of market opportunities, and setting many records in 61 years of building and developing Vietnam’s oil and gas industry

On January 1, 2023, Prime Minister Pham Minh Chinh visited, worked with, and encouraged the employees of BSR, one of Petrovietnam’s key units, to overcome challenges, seize market opportunities, and achieve a record-breaking revenue in 2022.

The Group’s revenue reached VND 931.2 trillion. Despite the decline in oil and gas output due to field depletion, the oil price in 2022 reached $107 per barrel, and the total output in 2022 reached 18.92 million tons of oil equivalent. This revenue surpasses the previous record of VND 774 trillion achieved in 2012 when the domestic oil and gas exploitation reached 24.99 million tons of oil equivalent, and the crude oil price stood at $117.6 per barrel.

The consolidated pre-tax profit of the Group reached VND 82.2 trillion, surpassing the previous record of VND 70.6 trillion in 2013. In 2013, the oil price was $112.5 per barrel, and domestic oil and gas exploitation amounted to 25 million tons of oil equivalent.

The Group also achieved a record in protein exports, with an output of 606 thousand tons, marking a 2.1-fold increase compared to 2021.

Most of Petrovietnam’s key units achieved financial records. Specifically, the revenue of key units includes: BSR (VND 166 trillion), PV GAS (VND 101 trillion), PVOIL (VND 100 trillion), PVFCCo (VND 19.4 trillion), PVCFC (VND 14.8 trillion), and PVTrans (VND 9.2 trillion). The pre-tax profit of key units includes PV GAS (VND 16.6 trillion), BSR (VND 12.7 trillion), PVFCCo (VND 6.4 trillion), PVCFC (VND 4.0 trillion), and PVTrans (VND 1.4 trillion). Contributions to the state budget include BSR (VND 18 trillion), PV GAS (VND 7.2 trillion), PVFCCo (VND 1.5 trillion), and PVCFC (VND 580 billion).

3. Contributing to stabilizing the macro-economy, stabilizing the market, increasing export turnover

The total revenue of the Group is equivalent to 9.8% of the country’s GDP. The total revenue of the entire Group in 2022 is 931.2 trillion VND, and the GDP (at current prices) in 2022 is 9,513.3 trillion VND (source: General Statistics Office).

The payment to the state budget accounts for 9.5% of the total national budget revenue. The Group’s state budget payment is 170.6 trillion VND, and the total state budget revenue is 1,804 trillion VND (source: Government report on January 3, 2023).

These proportions represent the highest values since 2015 until now, surpassing the average proportion of the period 2016-2021, which was 7.6%.

PVFCCo exports goods to India

At the PVCFC export port, in 2022, Petrovietnam’s export of nitrogenous fertilizer products continued to achieve a record turnover of over US$405 million, representing 37% of the country’s total fertilizer export value.

Petrovietnam plays an increasingly crucial role in ensuring national energy security, maintaining macroeconomic balance, actively participating in market stabilization efforts, and providing fuel for national defense security. It has supplied over 13 million tons of petroleum, meeting more than 75% of the country’s petroleum demand.

PVN’s export of nitrogenous fertilizers maintained its record-breaking performance, generating a turnover of over US$405 million, which accounted for 37% of the country’s fertilizer export value.

4. Promote and perfect institutions; The Petroleum Law in 2022 was officially passed

National Assembly votes to pass Law on Petroleum (amended)

Petrovietnam places great emphasis on the completion of processes, regulations, policies, and legal frameworks, with particular attention to the recently approved Petroleum Law 2022. The law was endorsed by the National Assembly on November 14, 2022, and has been fully implemented, encompassing the key guidelines provided by the Party and State regarding the strategic direction for the development of Vietnam’s oil and gas industry, the sustainable growth of the marine economy, and the advancement of national energy development.

Additionally, Petrovietnam has successfully completed six sets of Governance Regulations, comprising 137 specified documents that have been digitized for enhanced accessibility and efficiency.

5. Scientific research, development, and application of technology make practical contributions and create breakthroughs

In 2022, 03 Oil and Gas projects and clusters will be awarded the Ho Chi Minh Prize, and 03 Petroleum projects will be awarded the State Prize in Science and Technology.

Petrovietnam is committed to leveraging the latest technology applications in the industry to drive breakthroughs in development, enhance labor productivity, and improve competitiveness in the production and business sectors. This commitment has been exemplified in the field of oil and gas exploitation, where the application of advanced technology has contributed to surpassing the planned oil and gas output. Particularly notable is the success achieved in areas where significant oil and gas fields have transitioned from stable exploitation to a period of potential growth.

The achievements of Petrovietnam’s oil and gas professionals have been recognized and celebrated. Three works and clusters of works have been honored with the prestigious Ho Chi Minh Prize, while three projects have received the State Prize in Science and Technology. These accolades account for more than 20% of the total awards bestowed nationwide. Additionally, seven scientific and technological research projects from Petrovietnam have been honored with VIFOTEC prizes.

6. Investment management achieved positive results

Effective portfolio management has been a key focus in all five areas, with a strategic allocation of investment resources towards high-performing projects. The diligent review of investment plans, intensified investment supervision, and prioritization of capital sources for critical projects have further enhanced efficiency.

As a result, the disbursed value has reached 26.5 trillion VND, reflecting a substantial increase of 42% compared to the disbursement figures in 2021. This signifies the successful implementation and execution of investment initiatives, demonstrating Petrovietnam’s commitment to driving sustainable growth and maximizing returns on investment.

In July 2022, inaugurated and put into commercial operation Song Hau 1 Thermal Power Plant.

PetroVietnam has initiated and revitalized the Thai Binh 2 Thermal Power Project, demonstrating its commitment to the development of the energy sector. Additionally, efforts are underway to finalize the necessary procedures, ensuring preparedness for the resumption of the Long Phu 1 Thermal Power Plant project. Furthermore, the inauguration and commencement of commercial operations of the Song Hau 1 Thermal Power Plant have marked significant milestones in PetroVietnam’s power generation initiatives. These endeavors underscore PetroVietnam’s dedication to expanding its energy portfolio and contributing to the country’s power supply capabilities.

7. Digital transformation has achieved initial results, forming a synchronous foundation of Petrovietnam

Pay by electronic transaction, read the QR code at the PVOIL gas station

Petrovietnam has successfully accomplished the digitization of all documents, ensuring regular updates through the implementation of AI applications and the integration of an enterprise resource management (ERP) system. Moreover, Petrovietnam has intensified its efforts in driving the digital transformation process, resulting in optimized production and business activities. This includes the establishment of smart factories, aimed at enhancing customer experience, improving competitiveness, and attaining tangible benefits from these digital advancements.

8. Reinventing Petrovietnam culture, enhancing brand value

From the results and achievements of the re-creation of Petrovietnam’s culture in recent times, the core values of “Aspiration – Intelligence – Professionalism – Love” have been reaffirmed. This has led to the restoration of the Petrovietnam brand as a key economic and energy group in the country. Petrovietnam’s efforts have contributed to ensuring energy security, food security, and economic security, as well as participating in the protection of national sovereignty and security at sea.

Currently, Petrovietnam’s brand value stands at nearly 1.3 billion USD, maintaining its position as one of the most valuable brands in Vietnam.

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Editor Board: PVFCCo's Marketing and Communications Division

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