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PetroVietnam tackles shortcomings

Update: April, 10/2012 - 10:37

 

A worker checks pressure gauges at the Dung Quat Oil Refinery Plant in central Quang Ngai Province. — VNA/VNS Photo Thanh Long
HA NOI — PetroVietnam (PVN) did not cause any loss of State capital but did make unauthorised investments in some areas and in capital advances without approval from the Prime Minister, said PetroVietnam's chairman Phung Dinh Thuc yesterday during an online company meeting.

In response to public concerns over the Government Inspectorate's conclusions about the group's management and use of capital, Thuc said recent media information about wrongdoing by the company had undermined its prestige in the eyes of the public and foreign partners.

In the meeting, Thuc explained and gave reasons for the nine errors unveiled in the Inspectorate's conclusion.

With regard to the Inspectorate's request to collect the VND1.922 trillion (US$91.5 million) PVN raised by equitising some member companies, Thuc said PetroVietnam Gas Corp had already paid over VND1.9 trillion ($90.6 million), equivalent to 99.4 per cent of the total due. The funds will be contributed to the business restructuring support fund.

Thuc attributed the delay to late payments from Electricity of Viet Nam to PVN's subsidiaries, including PV Gas. He also said PVN would continue to urge other members to pay the remainder of what they owed to the fund.

In response to concerns about its capital advances to non-petroleum projects in the central and southern provinces, worth a combined VND622 billion ($22.6 million), without the approval of the Prime Minister, Thuc said the moves were aimed at supporting land clearance to facilitate the implementation of PVN projects.

PVN used VND15.6 trillion ($742.9 million) of profit to invest in non-key projects (including projects of Vietsovpetro, PetroVietnam Exploration and Production Corp) but Thuc explained that during the inspection, the Government had not issued any criteria for key petroleum projects. According to PVN, Vietsovpetro and PVEP were petroleum companies and should be worthy of investment.

"After that we asked the Ministry of Industry and Trade to issue a set of criteria and on October 14, 2011, the Government published a list showing that those investments were in accordance with regulations," Thuc said.

PVN was also found to have violated the regulation on tenders by appointing some non-PVN units as contractors for some packages. Pham Thu Ha, PVN's deputy general director, explained that certain packages had specific requirements that PVN units were not capable of implementing at that time, such as counselling on land clearance, marine surveys and forecast verification.

Upon the Inspectorate's conclusion, PVN had directed its member units to terminate contracts with entities that were not entitled under the current regulations, Ha said.

"PVN has essentially tackled the nine shortcomings stated in the conclusion and recommendations of the Government Inspectorate," Thuc said, emphasising that the group was rapidly reviewing individual responsibilities.

In the first three months of this year, PetroVietnam continued to perform well, surpassing most of its targets for the first quarter. At the end of March, its total revenue reached VND189.4 trillion ($9 billion), up 25.3 per cent year-on-year and exceeding the first-quarter target by 29.4 per cent.

The group's contribution to the State budget totalled VND40.6 trillion ($1.93 billion), a year-on-year increase of 24 per cent and surpassing the period target of 15.3 per cent.

Its total oil production in the first quarter reached 6.45 million tonnes, equivalent to 106 per cent of the first-quarter plan and up 7.2 per cent year-on-year. Oil sales were 4.03 million tonnes, 4.4 per cent above the target. — VNS

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