Indonesia's fully state-owned energy company Pertamina saw its net profit grow by a whopping 221 percent (y/y) to USD $1.83 billion in the first half of 2016. This remarkable performance is attributed to the company's enhanced operational performance and efficiency in the upstream and downstream segments. Dwi Soetjipto, General Director of Pertamina, that despite the oil and gas industry being plagued by major challenges, Pertamina managed to take its responsibility in terms of the energy supply, being the nation's foremost local energy supplier.
The challenging context - with oil prices still low - in fact made the firm decide to implement measures that are aimed at optimizing existing operations, its so-called Breakthrough Project.
Soetjipto said Pertamina remained focused on its five priority pillars: (1) upstream development, (2) to optimize efficiency, (3) to increase refinery and petrochemical capacity, (4) infrastructure development, and (5) to improve its financial structure.
However, Arief Budiman, the Finance Director at Pertamina, informed that the state-owned company's revenue fell 21 percent (y/y) to USD $17.2 billion over the same period. This was due to persistently low global oil prices, particularly in the first quarter of the year. This has had a big impact on all oil and gas companies. A competitive crude oil price starts at USD $60 per barrel. However, oil is still trading at below USD $50 per barrel.
In the first six months of 2016 Pertamina managed to produce an average of 305 barrels of oil per day (bpd), up 11.3 percent (y/y) from oil production realization in the same period one year earlier, and 1,938 mmscfd of gas, up 21 percent (y/y). Meanwhile, Pertamina's production of geothermal energy rose 3.2 percent (y/y) to 1,466 Gwh.
Dwi Wahyu Daryoto, Pertamina's Human Resources Director, said the company has successfully implemented its Breakthrough Project (BTP), an efficiency-driven program (which includes the optimization of operating costs). As of June 2016, the financial impact of BTP reached USD $1.21 billion, while by the year-end the financial impact of the BTP is estimated to each USD $1.64 trillion.