Pertamina Net Income Shrunks to US$1.4 billion Amid Stagnant Oil Price

Photo by EV

JAKARTA (TheInsiderStories) – The largest energy provider in Indonesia, PT Pertamina’s profit shrunk 24 percent to US$ 1.4 billion in the first half (1H) of 2017 amid the low oil price. Based on the financial report of the company, Indonesia crude oil price stayed at US$48.84 per barrel in the during January to June.

On the other hand, President Director Elia Masa Manik told reporters, the company gained revenue of $20.5 billion in 1H 2017, rose by 19 percent compared to the 1H of 2016 worth of $172 billion supporting by its downstream businesses. In the upstream sector, oil and gas production rose 8 percent to 692 thousand barrels of oil equivalent per day (MBOEPD) during the first half of 2017.

“During first half of this year, the external condition is still very ‘volatile’ with the trend of world oil prices continue to lowered. Meanwhile, the rising of crude oil prices have become an incentive for the upstream business, but also increased our cost productions and hit our profitability,” he added.

Masa explained, the oil production rose 12 percent to 343 MBOPD in the 1H of 2017 and gas lifting up 4 percent to 2,022 million cubic feet per day (MMSCFD) compared to same period in the 2016. The sales of gas to transport recorded 253.1 billion cubic feet (BSCF) and the sale of liquefied natural gas (LNG) realized 258.01 million MMBTU.

On the other hand, in anticipation of the external factors, Pertamina still run the program efficiency and the creation of added value through break through the project, which had recorded $360 million, as well as other strategic initiatives.

The state-owned company targeting this year’s net profit to exceed $3 billion by making $1 billion of efficiency and business expansion. Last year, the company’s net profit reached $3.15 billion. According to Masa, to maintain the net profit stay in the range of $3 billion, Pertamina will conduct maping for subsidiaries related to the acquisition plan of the refinery and others.

“Under the current condition, Pertamina is relatively able to maintain the growth rate of operating performance in various business lines of the company. To maintain our profitability we will make calculation which is reliable, credible and accountable,” He said.

Pertamina remains highly committed to the realization of various refinery projects, both the Refinery Development Master Plan and the New Grass Root Refinery, which is targeted to be thoroughly completed by 2025 with a total capacity of 2 million barrels per day. (MS)