Pertamina posts double-digit fall in revenues

Jun 01, 2016 12:00 AM

Oil and gas giant Pertamina saw its top line plunge by more than 40 percent as oil prices remained under pressure throughout last year.

The state firm announced on Tuesday that its revenues dropped significantly by 40.3 percent to US$41.76 billion in 2015 from $70 billion in 2014.

It attributed the plunge to falling oil prices. Last year saw both prices of West Texas Intermediate ( WTI ) and Brent Crude sink to their worst levels.

WTI, for instance, dropped by more than 30 percent to end at $38.10 per barrel, while Brent decreased more than 36 percent to $37.90 per barrel.

Despite the price fall, Pertamina president director Dwi Soetjipto said that it managed to keep its head above the water, supported by various efficiency measures and the ongoing liquidation of the Pertamina Energi Trading Ltd. ( Petral ) unit.

He claimed that the measures had helped the company salvage its profitability, leaving its bottom line at Rp $1.42 billion, around the same level recorded in 2014.

“Pertamina looks like an anomaly among other companies that seem to have experience double-digit slowdowns. Pertamina’s decrease was only slight,” he said, adding that it was able to maintain the number of its workers as well.

Data provided by Pertamina shows that several other oil and gas giants had experienced dramatic decreases in their net profits.

Royal Dutch Shell’s net profits decrease by 80 percent to $3.8 billion last year, while Chevron’s bottom line dropped 76 percent to $4.6 billion in the same period.

Meanwhile, despite posting a drop in its revenues, Pertamina was able to increase its oil and gas production last year.

Its crude production climbed by 11 percent to 606,700 barrels of oil per day ( bopd ) and its gas production increased 18 percent to 1.9 billion standard cubic feet per day ( bscfd ).

It also managed to increase its production of geothermal energy by 8 percent, adding up to an equivalent of 3,056.82 gigawatt hours of electricity.

Thanks to the higher production, Pertamina ended 2015 with 3,898 thousand barrels of oil equivalents in reserve replacement of oil and gas.

The hike in upstream production is a fruit of its decision to allocate a majority of its capital expenditure to the upstream sector.

“We managed to increase production even with the low oil prices,” Pertamina’s upstream director Syamsu Alam said.

The increase in Pertamina’s production is actually good news for the country as it is anticipating an increase of oil demand to 1.6 million bopd this year.

Its lucky streak has continued by entering 2016 with higher production.

During the first quarter of this year, its oil production amounted to 306,250 bopd, an annual increase of 14.5 percent compared to the same period in 2015. Part of the figure came from overseas production in Iraq, Algeria and Malaysia.

At the same time, its gas production increased as well, up 22.2 percent annually to 1.98 bscfd.

Meanwhile, Energy and Mineral Resources Minister Sudirman Said met with Iranian Oil Minister Bijan N. Zangeneh on Tuesday as a follow-up to an agreement between Pertamina and the National Iranian Oil Company ( NIOC ).

NIOC has agreed to supply 88,000 tons of liquefied petroleum gas from Iran to Indonesia beginning this year and the figure will gradually increase to 500,000 tons by 2017.

Sudirman added that Iran had also expressed an interest in investing more in Indonesia’s refinery sector.

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