PetroVietnam mulls bond issue

29 August 2018, Week 34, Issue 640

PetroVietnam is considering issuing bonds in international markets to help fund new projects, the state-run oil company said last week.

“PetroVietnam needs to get access to foreign funds, including through commercial loans and international bond issuance, and it needs advice from experienced international banks for its capital restructuring,” it said.

French investment bank BNP Paribas is interested in co-operating with the Vietnamese energy company in its Block B and Sao Vang-Dai Nguyet gas projects offshore Vietnam, the statement read.

BNP Paribas is also interested in acting as an advisor to help PetroVietnam with its plan to issue international bonds and to provide loans for renewable energy projects, according to the statement.

PetroVietnam did not, however, reveal how much money it was looking to borrow, either from bond investors or in the form of loans. Vietnamese daily newspaper Tuoi Tre reported in April that PetroVietnam was considering a US$500 million bond issue and that the sale could take place in 2020.

Last week’s statement follows a meeting in Hanoi earlier that week between PetroVietnam chairman Tran Sy Thanh and BNP Paribas’ co-head of investment banking for Asia Pacific, Thierry Olive.

Higher oil and gas prices are already boosting revenue for many PetroVietnam units, helping shore up its bottom line.

PetroVietnam Gas (PV Gas), for example, revealed in June that in the first six months of 2018 it generated 6.6 trillion dong (US$283.4 million) of net profit – equal to 82% of its full-year target. At 37.5 trillion dong (US$1.61 billion), its first-half revenues also equalled 66% of the company’s target for 2018.

A rebound in crude prices has been largely credited for the group’s strengthening financial performance. Global oil prices averaged US$71 per barrel in the first half – 42% higher than PV Gas had predicted. The company’s production of light oil, LPG and condensate also expanded.

A string of initial public offerings (IPOs) for PetroVietnam subsidiaries also continue to boost state coffers.

In the first six months, as much as 7.45 trillion dong (US$319.8 million) was collected for Vietnam’s state budget from the IPOs of PetroVietnam Oil (PVOil), PetroVietnam Power (PV Power) and the Binh Son Refining and Petrochemical One Member, PetroVietnam said earlier this month.

Edited by

Andrew Kemp

Editor

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