In the first 3 months of 2020, the Covid-19 pandemic has severely affected most of the major economies in the world and Vietnam is suffering direct consequences in all areas of production and business when value chains are being seriously affected by disruptions of supply and demand of goods, raw materials and fuels. In this context, the price of crude oil in the world market falls seriously, creating a double crisis for the Oil and Gas industry.
Facing such situation, Vietnam National Oil and Gas Group and its member units have taken initiative in synchronous deployment of coping solutions in order to best protect the health of petroleum workers, at the same time maintain production and business activities, minimize the impact of the pandemic and oil price shock. All officials and employees of the Group have been actively responding, joining hands and forces with the Group to overcome this difficult and challenging period. It is evidenced by the Group's production and business results in the first quarter of 2020.
Timely response measures of the Group:
- Party organization, business leaders/ unions at all levels throughout the Vietnam National Oil and Gas Group have unanimously implemented and encouraged the entire political system to implement the prevention, fighting and control of Covid-19 epidemic, carry out urgent tasks and solutions to cope with oil price decline;
- The Group's President and CEO has continuously issued and implemented many directives and plans on task performance, urgent solutions to cope with the double impact of the Covid-19 epidemic and oil price decline;
- Following the General Secretary – State President’s Call and the Prime Minister's Directive, the Group has urgently implemented the plan for officials to work online at home and only arrange an “irreducible” division working directly at the office;
- Promoting the spirit of working to improve labor productivity, economical and efficient use of infrastructure, working facilities, avoiding waste ... for employees who directly produce and work at the office as well as working online at home;
- The Group and its member units thoroughly focus on directing production and business, strengthening optimal cost management, deploying the application of tools and solutions to reduce costs, save time and improve labor productivity (application of information technology, enhancing innovations, inventions, technical improvement solutions ...). Reviewing and cutting costs in the plan but not really necessary, not proposing expenses incurred (if not required to be handled) in order to reduce synchronously with revenue reduction, including reduction of workers’ personal income;
- Actively coordinate with the units in the Group, in the country to share information, resources, markets ... in order to optimize the efficiency in the whole value chain, enhance cooperation with domestic enterprises having business activities related to the products that the unit supplies.
- Actively capture and update market information on supply and demand, price fluctuations of crude oil and petroleum products, thereby developing plans and scenarios for advising with competent authorities and operating specifically at each time to take advantage of opportunities to improve operating efficiency, reduce damage due to market impacts.
Results of production and business activities
Production and business targets:
The Group has basically fulfilled the targets and tasks of the exploitation and production plan set out in March and the first quarter of 2020, specifically:
Total oil production in March exceeds 8.1% plan of the month, and that of the first quarter exceeds 10.1% of the first quarter plan and equaled 26.6% of the year plan.
Electricity production in March is 2,097 billion kWh, exceeding 3.8% of the plan for March, and it is 5.33 billion kWh in the first quarter, reaching 100% of the first-quarter plan and equaling 24.7% of the year plan.
Fertilizer production in March is 136.9 thousand tons, and it is 441.8 thousand tons in the first quarter, exceeding 5.5% of the first-quarter plan and equaling 28.3% of the year plan.
Gasoline production in March is 1,149 million tons, exceeding 1.7% plan of the month, and it is 3,415 million tons in the first quarter, exceeding 2.5% of the first-quarter plan and equaling 28.9% of the year plan.
The average crude oil price in March 2020 decreases by 20USD compared to February 2020 (≈ decrease by 33%); Average oil price in the first quarter of 2020 decreases by 3.8 USD/ barrel (≈ decrease by 6%) compared to the year plan price (60 USD/ barrel), down 9.1 USD/ barrel (≈ decrease by 14%) compared to the average price of the first quarter of 2019 (65.3 USD/ barrel). Brent oil price is currently fluctuating around 25-27USD/ barrel.
Total revenue of the Group in March is 49 trillion dong, equaling 80.8% of the month plan, and it is 165 trillion dong in the first quarter, equaling 90.9% of the first-quarter plan and equaling 25.7% of the year plan.
The whole Group’s contribution to the State budget in March is 6.5 trillion dong, equaling 90.6% of the month plan, and it is 20.8 trillion dong in the first quarter, equaling 89.7% of the first-quarter plan and 25.3% of the year plan.