Friday, 24 May 2019

PetroVietnam steps up divestment process by 2020

Updated at Friday, 10 Aug 2018, 16:25
The Hanoitimes - The move is in line with the plan for comprehensive restructuring of PetroVietnam in the 2017 - 2025 period.
State-run energy giant Vietnam National Oil and Gas Group (PVN) plans to reduce holding in its subsidiary PV Drilling (PVD) to 36% and divest entire stakes at a number of enterprises by 2020, according to CafeF.
Illustrative photo.
Illustrative photo.
In the initial plan, PVN would cut its stake in PV Drilling to 25% from 50.4% to attract buyers. However, as PVD's operation is related to national security, PVN recommended reducing its holding in the company from 50.4% to 36% in the 2018 - 2020 period. The 36% stake would help PVN retain its veto rights in PVD.

Companies subject to complete divestment by PVN include PetroVietnam General Services (Petrosetco) with PVN's holding of 22.24%, PetroVietnam Engineering (PVE) with 29% and PetroVietnam Drilling Mud Corporation (PV-DMC) with 36%. 

The move is in line with the plan for comprehensive restructuring of PVN in the 2017 - 2025 period.

Moreover, the divestment process at PetroVietnam Gas (PV Gas) can be extended beyond 2020. 

Under the Prime Minister's instruction, PVN is required to divest stake at PetroVietnam Construction (PVC) in the 2018 - 2019 period. However, due to PVC's involvement in a number of large-scale energy projects, PVN recommended the PM and the Ministry of Industry and Trade to lengthen the divestment process beyond 2020. 

According to HSBC, PVN would face numerous challenges in completing the goals set for 2018 as global crude oil prices have fluctuated wildly. The East Sea dispute also affects oil exploration as well as foreign investment.
Ngoc Thuy
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