Page 9 - AsianOil Week 34

AsianOil SOUTHEAST ASIA AsianOil

Pertamina posts first-half loss

PERFORMANCE INDONESIA’S state-owned Pertamina swung
into the red in the first half of the year as a “triple
shock” of weaker energy demand, lower oil and
gas prices and a depreciating rupiah took its toll.
The company said on August 25 that it had
recorded a net loss of $767.92mn in the first half, com- company would have to cut costs further and
pared with a $659.96mn net profit a year earlier. that layoffs were likely on the horizon.
“The COVID-19 pandemic, the impact is “In the end, it will be unavoidable for Pertam-
very significant for Pertamina. The decline in ina and its partners to fire employees,” he told the
demand, the depreciation of the rupiah, and Post. “Under such conditions, Pertamina cannot
also the very sharp fluctuation of the crude price contribute to economic growth.”
has greatly affected our financial performance,” The major, however, is more upbeat. Usman
Pertamina’s vice-president of corporate commu- said: “Pertamina is optimistic that until the end
nication, Fajriyah Usman, said on August 24. of the year there will be positive movements so
She said that in the first half of the year fuel it is projected that profits will also be positive,
consumption fell by 13% year on year to around considering that slowly the world oil price has
117,000 kilolitres from 135,000 kilolitres per day. started to rise and also fuel consumption, both
Falling sales saw revenue sink 19.8% y/y to industry and retail, is also increasing.”
$20.48bn on the back of a softening in lower While the Brent crude benchmark dropped
domestic crude and oil product sales following the below $20 per barrel earlier this year it has since
introduction of social quarantine restrictions. rebounded. The US Energy Information Admin-
The company managed to slash its spending istration (EIA) noted that the benchmark aver-
by 14.1% y/y to $18.87bn, with a reduction in aged $43 per barrel in July, up $3 per barrel on
sales expenses managing to offset an uptick in June’s average. It is currently trading around $45
upstream investment. per barrel and is expected to average $43 per bar-
Gadjah Mada University economist Fahmy rel in the second half of this year before rising to
Radhi told the Jakarta Post on August 24 that the $50 per barrel in 2021.™

EAST ASIA

Nigerian-Chinese JV aims to

commission refinery in September

PROJECTS & A Nigerian-Chinese joint venture is hoping to ($1.81mn) in debt financing available, and the
COMPANIES commission its new 6,000 barrel per day modu- joint venture will make payments once the refin-
lar refinery in Edo State sometime next month. ery begins production, he said. “This was the cat-
Representatives of the JV – AIPCC Energy, alyst to the project to ensure quick take-off, and
a joint venture formed by Nigeria’s AFCOM it is a beneficiary of the Edo State government
and China’s Peiyang Chemical Equipment incentive programme to attract manufacturing
Co. (PCC) – informed Business Day last week companies to locate in the state,” he explained.
that work on the refinery was already 95% Nigerian federal authorities also offered sup-
mechanically complete. Pre-commissioning port by exempting imported equipment and
operations are due to begin before the end parts from customs duties, he noted.
of August, and commissioning will follow in The modular refinery is being built in Ologbo,
September if regulatory agencies approve the a town in the Ikpoba Okha region of Edo State, at
plan, they said. a cost of about $10.2mn. When finished, it will be
AIPCC Energy chairman Michael Osime able to produce naphtha, diesel and residual fuel
called the project a success, pointing out that the oil (RFO). PCC has been responsible for all engi-
joint venture had succeeded in building the plant neering, procurement and construction (EPC)
in less than a year. “This indeed is a remarkable work on the project.
feat for us and Nigeria,” he was quoted as saying According to Osime, AIPCC Energy may
in a company statement. “It will be the quickest eventually expand the refinery’s throughput
modular refinery [ever] delivered.” capacity to 30,000 bpd. The cost of this endeav-
Osime also thanked the state government our is likely to top $64mn, and PCC has offered
for backing the project. Edo made NGN700mn to finance 40% of this sum, he said.™

Week 34 27•August•2020 www. NEWSBASE .com P9