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JAKARTA (TheInsiderStories) – National oil company, PT Pertamina targeting this year’s net profit to exceed US$3 billion by making $1 billion of efficiency and business expansion, said the company on Wednesday. Last year, the company’s net profit reached $3.15 billion.

In the first quarter (Q1) of 2017, net profit of the state-owned company dropped 25 percent from $1.1 billion to $760 million due to increased production costs. Finance director Arief Budiman explained, blamed the rise of oil price as the key reason behind the net profit falls. The average Indonesian Crude Price (ICP) in the quarter

In the first quarter, the average ICP to $51 per barrel, nearly doubled from the same quarter last year of $30.32 per barrel, or surged 69 percent. Although the net profit declined, revenues of the company grew by 19 percent in the quarter to US$10.15 billion, from $8.55 billion in the same quarter last year.

Elia Masa Manik, the president director adding, 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,” said Massa at the press conference at Pertamina’s office.
Pertamina reported during Q1 of 2017, the company’s upstream oil and gas production growth 6 percent and fuel sales by 5 percent compared to the same period in 2016. Oil production reached 337 thousand barrels per day (bopd), or up 10 percent compared to Q1 2016 of 312 thousand bopd.

Similarly, gas production reached 2,010 million metric standard cubic feed per day (mmscfd), up 2 percent compared to the Q1 of 2016 at 1,975 mmscfd. Overall Pertamina’s oil and gas production in the first quarter increased by 6 percent.

Fuel sales rose 5 percent to 15.85 million kilo liters (KL), with a positive trend on non-subsidized fuel consumption in the form of consumer’s switching from Premium to Pertalite and Pertamax which has taken a sales share of about 55.7 percent of total sales of Pertamina gasoline series. Growth also occurred in non-fuel oil sales (domestic gas and petrochemical) which rose 6 percent to 3.68 million KL.

Meanwhile, capital expenditure realization amounted to $1.1 billion, larger than the same period in 2016 of $36o million. The increase was triggered by the realization of 2016 project financing disbursements disbursed in the first three months of 2017, which is dominated by upstream investment.

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.

Realized capital expenditure in the Q1 reached $1.11 billion, higher than the same period last year of $360 million. (*)

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