CEO of energy producer, PT Pertamina, Nicke Widyawati told member of parliament that her company experienced triple shock during the coronavirus outbreak - Photo Privacy

JAKARTA (TheInsiderStories) – CEO of energy producer, PT Pertamina, Nicke Widyawati told member of parliament that her company experienced triple shock during the COVID-19 outbreak. At return, she said, in 2020, the state-owned firm’ net profit could drops up to 51 percent and revenues 44 percent compared to previous year.

“Pertamina was hit by a shock in the decline in global supply, price projections and the Rupiah condition,” said the CEO during a hearing with Commission VII of House of Representatives through video conference, today (04/21).

Initially, the company targeting profit of US$2.2 billion and the revenues of $58.33 billion. On the worse scenario, she said, the potential revenues is expected to plummet to $32.08 billion.

She elaborated, if the world oil prices are in the range of $38 a barrel and Rupiah stayed a 17,500 per US Dollar, Pertamina‘ revenues will collapse up to 38.37 percent. But, if the crude price is $31 a barrel and the exchange rate is 20,000 over the Greenback, the producer’ revenues could drop by 44 percent, she adds.

Earlier, Widyawati optimistic, this year the major oil and gas producer could posts a net profit around US$2.2 billion. The target is up 10 percent compared to 2019′ target of $2 billion.

Pertamina aimed to produces oil and gas 923,000 barrels of oil equivalent per day (BOEPD), which is oil production 430,000 barrels per day (BPD) and gas production 2,857 million cubic feet per day (MMSCFD).

But caused of the COVID-19, the company’ has adjusted the oil and gas upstream production to 894,000 BOEPD. In details, oil production sliced to 421,000 BPD, gas from to 2,745 MMSCFD, and geothermal from 4,635 to 4,045 megawatts.

She also estimated that sales of industrial and aviation fuels will drop by 30 percent in this year and crude processing fell by 43 percent. In anticipation of the falling oil price, said the CEO, Pertamina is preparing a heavy and very heavy scenario.

Upstream director, Dharmawan H. Samsu added, in the midst of the pandemic and the drop in world crude oil prices, the producer  increased the optimization in various aspects to keep upstream oil and gas production in 2020 remaining at normal levels. Its undeniable that the current conditions have resulted in various operational and financial consequences, such as the disruption of mobility and the shifting schedule of field workers, logistical constraints and interaction with stakeholders and the possibility of decreasing income from the upstream sector.

Samsu said, operationally, exploration wells and exploitation wells will be reduced by 35 percent and 25 percent, respectively. Its expected that with this step, Pertamina ‘upstream sector operating costs can be streamlined from $5.52 billion to $4.44 billion, while investment costs are optimized by 24 percent from $3.7 billion to $2.8 billion.

“We have to adapt to any conditions, both when the price of crude oil jumps and falls sharply. And for the present condition, we are optimistic that we can get through this difficult time well and continue to try to keep upstream oil and gas production this year can still be reached above 894 MBOEPD,” closed by the director.

Pertamina is a 100 percent Indonesian government-owned, fully-integrated oil and gas corporation, with operations in upstream exploration and production, gas transmission and distribution, and downstream refining and marketing.

updated at 4.39 p.m.

Written by Staff Editor, Email: theinsiderstories@gmail.com