From 2016 to 2020, oil and gas continue to be the biggest industry in Vietnam, contributing about 10 percent to the country’s GDP. During this period, the total production of crude oil and gas reached 71.11 million tons and 50.04 billion cubic meters, respectively.
In 2020, the total oil production was expected to reach 20.5 million tons, which exceeded 0.7 percent of the annual plan. The annual plan of oil production for 2020 was from 10 to 15 million tons. Specifically, mining output crude oil extraction for the whole year reached 11.47 million tons, exceeded the annual plan by 8 percent; Gas production reached 9.03 billion cubic meters, equaling 92.7 percent of the annual plan.
The increase in oil and gas reserves in the five years from 2016 to 2020 was estimated at 56.26 to 61.26 million tons of oil equivalent. The average annual reserves were about 11.2 to 12.4 million tons of oil equivalent. Total oil and gas production from 2016 to 2020 was estimated at 120.87 million tons of oil equivalent.
Total crude oil production in the period of 2016 – 2020 was 71.11 million tons. Of which, there were 61.24 million tons produced domestically, and foreign production was 9.87 million tons.
Total gas production in the same period was 50.04 billion cubic meters, which met the usage needs of electricity plants and other industrial and commercial units.
Due to the impact of the COVID-19 pandemic, and the deep drop in oil prices in 2020, the production, business, and investment activities of the oil and gas industry were greatly affected. Different areas of the industry such as prospecting, exploration, and exploitation of oil and gas; petroleum processing and distribution of petroleum products; oil and gas services; were the most directly and heavily affected. However, the industry still ensured to complete the set production and business plan.
In 2020, many large enterprises in the oil and gas industry, such as Binh Son Refining And Petrochemical Joint Stock Company, Vietnam Oil Corporation, Vietnam National Petroleum Group (Petrolimex), Southern Gas Trading Joint Stock Company; experienced a sharp decline in profits because of the impact that comes from oil prices dropping. However, in the first months of 2021, those enterprises benefited from rising oil prices and became profitable once more.
Petrolimex had a positive pre-tax profit of 1,013 billion VND in the first quarter of 2021, in contrast to a loss of 1,702 billion VND compared to the same period last year. In the first quarter of 2021, Petrolimex’s domestic output maintained a positive momentum when it increased by 4.7 percent over the same period last year, reached 2.27 million cubic meters. The retail channel alone accounted for 55 percent to 60 percent of Petrolimex sales volume, contributed about 80 percent of the profit.
Similarly, in the first quarter of 2021, the profit after tax of Vietnam Oil Corporation reached 190.6 billion VND, while the same period lost 537.7 billion VND.
The oil and gas industry profit after tax will grow by 741 percent in 2021, this number was forecasted by FiinGroup. The profit growth is predicted to be coming from the “downstream” group, including Binh Son Refining and Petrochemical Joint Stock Company, Vietnam National Petroleum Group, and Vietnam Oil Corporation. Among these, Binh Son Refinery and Petrochemical have fulfilled 213 percent of the annual profit plan in the first quarter.
Meanwhile, most enterprises in the “midstream” group have planned to reduce profits sharply in the context that oil and gas exploitation in Asia has not been accelerated, despite rising oil prices.
As stated by SSI, for Vietnam's oil and gas industry, oil price maintaining above 60 USD a barrel is a favorable condition for conducting exploration and production activities. Besides, the construction of LNG (liquefied natural gas) infrastructure is also a strategy that the industry focuses on promoting in the coming time.
With the recovery of oil prices, the outlook for 2021 for the oil and gas industry is positive.
Compiled by VietnamCredit