KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) posted a 61.7% surge in net profit to RM20.7bil for the first quarter ended March 31 compared with the corresponding quarter a year ago on the back of higher margins.
Revenue grew 14.6% to RM75.2bil due to stronger crude oil and gas prices as well as higher crude oil trading volume.
However, he said a combination of demand destruction due to economic uncertainties, geopolitical issues and higher oil supply would weigh on oil prices going forward.
From left: Petronas chief executive vice-president, finance, Datuk George Ratilal; executive vice-president, gas and power business, Datuk Anuar Ahmad and Shamsul at the briefing. — Bernama
Shamsul said the first quarter was good. “We’ve been lucky, we had high oil price and high gas production,” he said, adding that what remains challenging would be maintaining crude oil production both in Malaysia and overseas.
The US economy was looking good at this point but recovery remained fragile with not much improvement for the rest of the year.
He said oil prices were likely to be capped in the range of US$80 to US$90 per barrel (Brent crude) over the next four to five years as new supply came in. Brent has fallen more than 16% after reaching a high of US$124.75 in mid-March. In recent days, it has been hovering around US$103 to US$104.
“I’m fairly bearish about oil prices going forward, I’ve said this before and I stand by it,” Shamsul said, addding that in spite of the low prices, the Saudis were still increasing production while the United States has started to export petroleum.
He said that gas production in the second quarter would not be as good as the first because with the advent of summer, demand from the temperate countries would be lower.
Shamsul pointed out that production facilties in oil fields straddling the border between Sudan and south Sudan would not resume until the end of the year due to the ongoing hostilities between both countries.
“We do not foresee any amicable solution so our bottomline may take a hit of RM3.2bil,” he added. The shutdown has caused Petronas to lose 130,000 barrels a day of production.
Meanwhile, Shamsul said the first of six risk-sharing contracts (RSC) for the development of marginal oil fields in waters surrounding Malaysia would be awarded in the next few days. “Its pending the approval of the Finance Ministry,” he said.
Shamsul said a data review of the 23 marginal oil fields (out of an original 25) have just been completed with the fields grouped into six clusters. “Proposals have been requested from the interested parties and the evaluation is ongoing with all the contracts to be awarded by the end of this year,” he added.
Shamsul said Petronas would continue to be on the lookout for merger and acquisitions (M&As) but this would entail selling off non-core assets such as its 3.9% stake in Centrica plc, a London-based supplier of gas. The stake was sold for over RM3bil in early February.
“We’ll need to fatten our cash pile if we’re to make any M&As since oil and gas prices will be lower,” he said.
Petronas’ shareholders approved in March a final tax-exempt dividend of RM28bil for the financial year ended Dec 31, 2011 payable in eight instalments between April and November 2012. The firm has indicated that from 2013 onwards, the payout ratio for dividends would be 30%.