PV Gas bolsters gas market development for growth goals: CEO

PV Gas, a subsidiary of state-owned Petrovietnam, is adopting solutions to promote gas market development to achieve its growth goals amid the rapidly changing energy market and incomplete mechanisms and policies related to liquefied natural gas (LNG), said its CEO Pham Van Phong.

Speaking at a conference to review Petrovietnam’s performance in the first half of this year and launch tasks for H2 in Hanoi on Sunday, he said in H1, PV GaS deployed business activities in the context of numerous difficulties and challenges. For example, the world situation continued to develop complicatedly, while the prices of Brent oil and LPG and LNG gas products strongly fluctuated.

Phong noted that domestic gas supply decreased sharply to only 83% of the same period last year. Especially, gas output in the southeastern region dropped 23% year-on-year, double the forecast of about 10-15% made at the beginning of 2024.

PV Gas's total gas output supplied to shore fell 700 million cubic meters compared to the same period last year, corresponding to a decline of VND5 trillion ($197.43 million) in revenue and nearly VND1 trillion in profit, he added.

In response to the situation, Phong stated that PV Gas's leadership had made efforts and stayed determined to focus on implementing safe, stable, effective business activities to achieve year-on-year growth.

Firstly, the corporation officially put the Thi Vai LNG warehouse project into operation. It imported 330 million cubic meters of LNG to serve domestic needs and provided 240 million cubic meters of regasified LNG to power plants to produce over 1.2 billion kWh of electricity.

This contributed to ensuring electricity supply during the peak dry season, and marked a milestone as the first imported LNG used to produce electricity in Vietnam, as well as supplied to industrial customers.

Secondly, PV Gas has gradually transformed its business model to make the best use of the corporation's advantages, in accordance with new market situations and international business practices.

Most of its member units saw positive business results. Notably, PV Gas's LPG sales reached 1.5 million tons in H1, representing a year-on-year rise of 38%, the highest level ever.

Revenue from the LPG business reached $1 billion, an increase of VND9 trillion ($355.38 million) over the same period in 2023, of which exports and international trade reached more than VND11 trillion ($434.35 million). Currently, the LPG business revenue accounts for 40% of the corporation's total revenue and 50% of the parent group’s.

Thirdly, PV Gas has fulfilled its management plan targets assigned by the group. Its total revenue reached VND64.5 trillion ($2.55 billion), equal to 111% of the plan, growing 12% year-on-year and ranking second in the group. Its pre-tax profit hit over VND6 trillion ($236.9 million), equal to 129% of the target and ranking third in the group.

Despite facing many difficulties and challenges in H1, Phong said that PV Gas continued to synchronously and effectively implement solutions in business, focusing on improving personnel as the current volatile business environment requires leaders to be dynamic, adaptable and sensitive.

They also need to make timely decisions, promoting changes in management, finding new motivations and renewing old ones, while drastically transforming its ongoing gas business model into an integrated business model that provides energy solutions to fully take advantage of PV Gas's competitive edges.

Regarding the future picture of domestic gas supply, following plans and national commitments on energy development, PV Gas has determined that infrastructure investment and LNG business development will be its main driving force, in parallel with optimizing the use of national resources.

However, LNG is a new business field in Vietnam and LNG business activities must comply with world market practices, thus requiring specific mechanisms and policies to minimize risks for the entire LNG business chain.

At present, policies and mechanisms related to LNG in Vietnam have not been completed. However, affirming the position and role of Petrovietnam and PV Gas in ensuring energy for development and in implementing commitments and policies set by the government, PV Gas will continue to adopt solutions to develop the LNG market, Phong noted.

Specifically, it will proactively propose competent authorities to allow it to participate in the drafting of policies and mechanisms necessary for LNG infrastructure business and development investment, especially LNG for power generation, he said.

It will implement a gas market development strategy in accordance with the group's orientation, including developing mechanisms to prioritize domestic gas sources for processing, and change its current gas business model to an integrated model to create advantages and mechanisms for LNG business development for industrial customers, he added.

The corporation will gather resources and develop its business, especially the international LPG/LNG business, to enhance its position, offset revenue, and maintain growth in the short and medium term due to the decline in domestic gas production.

According to the general director, initially, PV Gas has successfully brought LNG products to the market, supplying them to electricity production and industrial customers, but the journey ahead still faces many difficulties and challenges, with a heavy workload, Phong noted.

PV Gas believes that with the support of Petrovietnam and its persistent efforts, along with solidarity, and consensus of its staff, PV Gas will seize opportunities to develop and lead the LNG gas market in Vietnam, and ensure its sustainable growth and development in the future, he stressed.