On 7th April afternoon, Petrovietnam President and CEO Le Manh Hung chaired an online regular production and business meeting with heads of units throughout the Group about production and business results in March, the first quarter of 2022; at the same time discuss and forecast new geopolitical, macroeconomic and market developments to proactively and effectively deploy management and administration solutions in the coming months.
Petrovietnam President and CEO Le Manh Hung
Attending and directing the meeting were Mr. Hoang Quoc Vuong - Secretary of the Party Committee, Chairman of the Board of Directors; members of the Standing Party Committee, members of the Board of Directors, Vice President, Heads of Divisions/ Administration Office of the Group and heads of member units.
Petrovietnam Chairman of the Board of Directors Hoang Quoc Vuong delivers speech
Overview of the CEO meeting in April 2022 at the bridge points
In the first 3 months of 2022, the world economy has maintained recovery and production activities have been boosted. However, the effects of geopolitical conflicts have become the biggest concern besides the one about Covid-19 pandemic, leading to further decline in economic optimism. The complicated and prolonged conflict between Russia and Ukraine has created a shock that severely affects global growth: Disruption to trade and supply chains, increase in the price of food, energy and basic commodities, gradually tightening financial conditions, inflation pressure… Recent forecasts on global growth as well as our country’s economic growth in 2022 are all lower than previous ones.
Petroleum engineers maintain pipelines at Su Tu Trang field cluster
For Petrovietnam, in the first quarter of 2022, increasing oil price has facilitated the operation of units in the field of exploration and production of the Group; however, it is also the reason for the increase in input material prices for the units in the middle and downstream stages. The recent geopolitical situation and embargoes have had a direct impact on the activities of relevant units in the Group such as procurement of materials and equipment, logistics, changing shifts, choosing partners, contractors... commercial, financial, monetary issues, high costs, many risks.
On 16th March, Prime Minister Pham Minh Chinh chaired a meeting with Petrovietnam on the situation in 2021, the first two months of 2022 and the production and business plan for 2022
With the close attention of the Government leader, in the early March 2022, the Prime Minister chaired a meeting with Petrovietnam on the situation in 2021, production and business plan for 2022. The Prime Minister came to work and direct at the Group. The Government leader highly appreciated the Group’s achievements during the formation and development, especially the results achieved in 2021, and also recognized the difficulties, challenges and obstacles that the Group has been facing; directed the strengthening of solutions to increase the output of exploration and production when oil prices are high and the world is developing new and renewable energy sources.
Inheriting management solutions in the direction of sustainable development that have been implemented by the Group’s leaders in 2 years (2020, 2021), Petrovietnam urgently and actively deploys production and business activities with the goal of completing plan from the first quarter of the year.
Petrovietnam President and CEO Le Manh Hung inspected the progress of coal conveyor line item at Thai Binh 2 Thermal Power Plant in March 2022
With the initiative in forecasting, operating, managing fluctuations, taking opportunities, in March and the first quarter of 2022, the Group focused on deploying activities comprehensively, continued to fulfill and over-fulfill most of the assigned targets and main tasks with high growth over the same period. Petrovietnam made efforts to promote technical solutions and increase production under permissible conditions. Crude oil production in March reached 0.95 million tons, exceeding 24% of the plan of March, and generally in the first quarter, it reached 2.74 million tons, exceeding 25% of the plan of the first quarter and equaling 31% of the 2022 plan, an increase of 1% over the same period in 2021. It was a great effort of Petrovietnam facing the decline in natural production of existing oil and gas fields after a long production period and the investment, development of new fields facing many mechanism problems; the impact of political conflicts on the implementation of solutions to increase recovery and increase production of the Group’s units. Along with that, the production of petroleum, fertilizer and other products exceeded the plan. Gas and electricity production always ensured maximum supply for market demand. In the first quarter, Petrovietnam provided 1.4 billion m3 of gas for power production, 16.6% higher than the assigned plan (1.2 billion m3).
Over the past 12 years, BSR has imported 85 million tons of crude oil to serve the processing of products of Dung Quat Oil Refinery
With great efforts in all aspects of operations, in the first quarter of 2022, the Group’s total revenue was estimated at 197.12 trillion dong, exceeding 46% of the quarter plan, an increase of 49% over the same period in 2021; The Group’s contribution to the State budget was estimated at 29.31 trillion dong, exceeding 63% of the quarter plan, an increase of 29% over the same period in 2021. Thus, the Group’s contribution was about 7.7% of the total State budget revenue in the quarter. Compared to major oil and gas companies in Southeast Asia, Petrovietnam’s profit margin ranked second, just behind Petronas; management and credit ranked third. The result affirmed the efforts of the whole Group after a long time of persisting in solutions towards sustainable development.
Thi Vai one-million-ton LNG storage project continues to be completed
The implementation of power projects in the Group had many bright spots with positive steps, and achieved remarkable results. Thai Binh 2 Thermal Power Project successfully ignited Unit 1 with oil for the first time on 23rd February 2022. Song Hau 1 Thermal Power Project completed trial run, meeting the requirements/regulations of A0. Now the plant is ready for commercial operation of both units. Nhon Trach 3 and 4 Thermal Power Projects had EPC contract signed on 14th March 2022.
The activities of Covid-19 epidemic prevention, safety, digital transformation, research and development, value linkage, portfolio management, corporate culture, social welfare... were actively implemented. On 31st March 2022, Petrovietnam officially operated the first phase of the Enterprise Resource Planning (ERP) System at the parent company - Vietnam National Oil and Gas Group; Supplemented research on green hydrogen and green ammonia in the long-term scientific research program for the period 2021 - 2025. The implementation of linkage chains within the Group was accelerated, as of the first quarter of 2022, 23 value chains were deployed throughout the Group.
On 5th April 2022, Te Giac Trang field officially reached the production milestone of 100 million barrels of oil
Giving direction, Mr. Hoang Quoc Vuong - Secretary of the Party Committee, Chairman of the Board of Directors of Petrovietnam assesses that, in the second quarter, the impact of the political conflict will be more profound and pronounced, so it is necessary for the units, especially those in the field of exploration and production, to closely follow the market situation, prepare solutions to cope and overcome all difficulties to ensure the maintenance and increase production, take opportunities of market to continue contributing actively to the development of the country’s economy in the current difficult period. Besides, it is forecasted that in the second quarter, there will be a shortage of electricity for the economy, the plants in the Group need to be dynamic, creative and mobilize fuel sources to increase electricity production in the second quarter, contribute to ensuring electricity supply for life and production.
On 11th March 2022, Deputy Prime Minister Le Van Thanh worked with Petrovietnam’s leader to listen to a report on the production and business situation, and to solve the Group’s difficulties and problems
Concluding the meeting, Petrovietnam President and CEO Le Manh Hung says that in April as well as in the coming time, the Group will closely monitor macroeconomic, geopolitical and market developments, focus on forecasting, developing scenarios for accurate and timely operating solutions; strengthen implementation, improve efficiency of value chains, connect fields of activity to achieve the highest efficiency; focus on summarizing, assessing and managing risks on assets, capital sources, finance...; At the same time, the Group continues to promote technology application solutions in corporate governance; strengthen portfolio management, especially focus on key projects, large projects... Mr. Le Manh Hung emphasizes the whole Group must stick to the goals, tasks, and strive to fulfill the set targets in the remaining months of 2022.