State oil group PetroVietnam poised to beat 2016 output target

By Dam Tuan   October 12, 2016 | 01:31 am PT
It is expected to contribute a fifth of the state’s revenue this year.

The state-owned energy giant Vietnam Oil and Gas Group is well on track to beat production expectations, with total output set to hit 27.59 million tons of oil equivalent by the end of the year, or 7.6 percent above the annual target.

Crude output alone will be one million ton higher than the original target of 16.03 million tons.  

In the fourth quarter, the group, better known as PetroVietnam, is expected to pump 3.88 million tons of crude oil and 2.61 billion cubic meters of natural gas, according to a post on the government website.

The group will have to drill more oil fields to ramp up extraction.

With the higher-than-expected output, PetroVietnam will likely contribute a total of $4.68 billion to the state’s revenue target of $23.11 billion this year.

But due to low prices, its revenue for the period was 327.4 trillion VND ($14.71 billion), only 64 percent of the annual target. PetroVietnam’s output in the first nine months was 21.1 million tons of oil equivalent, including 13.03 million tons of crude oil.

Declines in the global oil market price could have repercussions for the state’s coffers.

In the first six months, the contribution of crude oil to the state’s revenue was estimated at VND20.3 trillion ($910 million), down 45 percent from the same period last year, according to the company.

To improve its fiscal positions, the government has been trying to increase revenue collection from other sources and ease its dependence on crude earnings.

Related news:

> PetroVietnam expects approval for Exxon gas field this month

> PetroVietnam’s contribution to state budget falls on low oil prices

> PetroVietnam aims to produce more oil amid modest GDP growth

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