Mind, mine, still much derailed to properly chew on PETRONAS' SUPER PERFORMANCE

Reporting RM61billion nett profits for FYE (financial year ending) March 31, 2008.

YL hopes you Esteemed Readers help him digest the national oil corporation's super revenues and profits -- includig declaring a special divident of RM6.1billion to the Government! -- and YET...

The Government deemed it fit to raise petrol and diesel prices by 40 and 60 percent respectively just a month ago, by which time I know for certain the topleaders have already known about Petronas' financials, but held back from announcing the results. WHY does YL say this?

Come back when I find the time... as other duties derail me to other paths less travelled.

Meanwhile, you digest these reports, from The Star Online:

* 1.

Tuesday July 15, 2008 MYT 4:23:50 PM
Petronas posts record profit, declares RM6b dividend to govt (updated)
By JOSEPH CHIN


KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) Group posted a record profit of RM61bil for the financial year ended March 31, 2008, which was a 31.5% increase from RM46.4bil a year ago.

Petronas president and chief executive officer Tan Sri Hassan Merican said Tuesday the national oil corporation also decided to pay out a special dividend of RM6bil to the Federal Government.

“The dividend will be paid out this calendar year,” he said, adding that Petronas still has sufficient cashflow from its operations for its own capital expenditure.

Announcing a strong set of results, Hassan said in terms of US dollar, Petronas Group’s net profit for the financial year ended March 31, 2008 rose 40.3% to RM18.1bil from US$12.9bil a year ago due to the stronger ringgit.


Petronas president and chief executive officer Tan Sri Hassan Merican announcing the Petronas financial results - Starpic by Ong Soon Hin

Petronas Group’s revenue rose 21.2% to RM223.1bil from RM184.1bil. In US dollars terms, revenue rose 29.8% to RM66.2bil from RM51bil.

Its total assets rose 15.2% to RM339.3bil from RM294.6bil while shareholders’ funds rose 17.6% to RM201bil from RM170.9bil.

Elaborating on the higher net profit for the group, he said apart from the group’s ability to contain costs, this achievement was also largely due to the improved operational efficiency and higher plant reliability achieved across the group’s businesses.

“The higher profit has enabled Petronas to provide higher payment to governments. For the year, Petronas Group paid out RM67.6bil to governments, bringing the group’s total payments to governments to RM403.3bil since its incorporation in 1974,” he said.

Of the RM67.6bil payment for the year, he said RM62.8bil was paid to the Federal Government comprising RM30bil dividend which included a RM6bil special dividend, RM20.6bil in the form of petroleum income tax, RM5.4bil in corporate income tax, RM2.1bil in export duties and RM4.7bil of royalty payment.

He said a total of RM4.8bil was paid as royalty payments to the state governments of Terengganu, Sarawak and Sabah.

“Petronas Group’s payment to the Federal Government for the year represents 44% of the Federal Government’s revenue,” he said.

Hassan also said the RM67.6bil total payment to governments for the year represented 63.1% of the Petronas Group profits for the same period.

He added that Petronas Group retained only 29.2% of its profits during the year for reinvestments and the balance 7.7% was used to pay foreign taxes and minority interests.

“The reinvestment is necessary to ensure the group’s sustainable operations and growth in order to be able to continue to generate value for its stakeholders,” he added.

He also said higher prices during the year also resulted in Petronas incurring a higher subsidy to the nation’s gas sector.

** 2.

Wednesday July 16, 2008
Petronas gas subsidies rise to RM19.7bil


KUALA LUMPUR: Petroliam Nasional Bhd’s (Petronas) total gas subsidies rose 26.3% to RM19.7bil for the financial year ended March 31 (FY08) from RM15.6bil in the previous financial year.

President and chief executive officer Tan Sri Mohd Hassan Marican said this brought the cumulative gas subsidy to RM77.9bil since 1997 as more companies in the non-power sector converted to gas, then deemed cheaper due to the subsidies.

Speaking at a press conference to announce the national oil corporation’s financial results yesterday, he said higher prices drove the non-power sector to switch more of their fuel source to subsidised gas, resulting in a 51.3% increase in subsidy to the non-power sector to RM5.9bil.


The non-power sector included the small industrial, commercial, residential users and natural gas vehicles.

On the gas subsidy to the power sector, Hassan said for FY08, Petronas provided gas subsidy of RM13.8bil, up 17.9% from the RM11.7bil in FY08. Since 1997, the cumulative subsidy was RM62.6bil.

Of the total, gas subsidy for Tenaga Nasional Bhd (TNB) was RM5.7bil, an increase from RM5bil in FY07, he said. The cumulative subsidy to TNB was RM26.9bil since 1977.

Hassan said Petronas had to also subsidise the independent power producers (IPPs) to the tune of RM8.1bil for FY08 from RM6.7bil a year earlier. Since 1997, the cumulative subsidy to IPPs was RM35.7bil.


Latest oil and other business news from the AP-Wire


*** 3.

Thursday July 17, 2008
Petronas chief lashes out at talent poachers
By JOSEPH CHIN


Firm is stepping up operations to increase national reserves

PETALING JAYA: The record high oil price has posed a challenge for Petroliam Nasional Bhd (Petronas) to stave off poachers seeking its trained staff while it seeks to expand its oil reserves.

President and chief executive officer Tan Sri Mohd Hassan Marican said it was not only the national oil corporation affected by the poaching of staff by companies in the Middle East.

“We have said before that Middle Eastern companies need to invest in training their own people and stop poaching trained people from other companies,” he said during Tuesday's briefing on the group’s results for the financial year ended March 31.

While he did not provide the number of staff who had left, Hassan said the poaching “has not had a major impact on our international or domestic operations”.

Petronas anticipated the staff poaching issue several years ago, he said adding that among international oil companies, there was mutual respect and understanding in Malaysia and also globally, that they would not poach from one another.

However, the poaching was by the Middle East companies and countries.

Petronas has more than 30,000 workers in more than 30 countries. Of the total workforce, 82% are Malaysians involved in upstream and downstream projects in a variety of geographic and business environments.

Besides having to contend with training and retaining its talent, the national oil corporation had also to embark on strategies to expand its oil and gas reserves through international ventures and deepwater exploration.


Hassan said Malaysia’ total reserves had fallen 0.5% to 26.37 billion barrels of oil equivalent (boe) as at Jan 1 from 26.49 billion boe on Jan 1 last year.

Crude oil and condensates accounted for 7.88 billion of the 26.37 billion boe while natural gas reserves were 18.49 billion boe. Domestic reserves totalled 20.13 billion boe and the remaining 24% or 6.24 billion boe were its international reserves.

Hassan said the reserves replacement ratio, based on the total reserves, had fallen to 0.9 times from 1.8 times last year.

However, it was more acute for its international reserves where the reserves replacement ratio had fallen sharply to only 0.6 times from 3.2 times.

Petronas had also stepped up operations to increase the national reserves, which saw it venturing more into deepwater exploration.

Since 2004, there has been a gradual increase in the reserves from the deepwater, from 4.34 billion boe to 5.46 billion boe this year.

On the outlook for Malaysia, Hassan said currently the country was a net exporter of crude oil and petroleum products except for petrol.

However, the country would become a net importer by 2011 if domestic demand continued to grow at 6% per annum. If demand grew at a slower pace of 4% per annum, Malaysia would be a net importer by 2014.

**** 4. "Sei" Loh!

Tuesday July 15, 2008
Oil price to see more stormy days
By FINTAN NG


Atlantic hurricane season could cause supply concerns

PETALING JAYA: The price of oil, which has fluctuated wildly over recent weeks on geopolitical and supply-side concerns, is likely to face more upward pressure in the coming weeks as the Atlantic Ocean hurricane season gains steam.

According to Singapore-based Purvin & Gertz, Inc senior principal Victor Shum, the Atlantic hurricane season has yet to run its course. Purvin & Gertz is an energy-industry consultancy.

“We’re still in the middle of the season, with August and September being the months where more hurricanes occur,” Shum told StarBiz yesterday.

In the past, the shutdown of refineries and oil rigs in the Gulf of Mexico that are in the path of hurricanes have led to crude prices rising because of supply concerns.

The price of light sweet crude closed at US$145.08 a barrel last Friday on daylight trading at the Nymex after an intra-day peak of US$147.27.

In the first two trading days of last week, crude lost US$9 due to a strengthening US dollar and worries over a global economic slowdown amidst inflation.

Last Tuesday, it declined as much as US$5 before gaining lost ground towards the end of the week after Iran’s Revolutionary Guards Corps test-fired at least one nuclear warhead-capable missile that could reach Israel and news broke of Israeli air force training exercises over Iraqi airspace.

At 6pm, crude was trading at US$143.23, down US$1.85 after the greenback strengthened on news that the US government was considering measures to help troubled mortgage providers Freddie Mac and Fannie Mae, which have been badly hit by the subprime crisis.

Shum said US$150 was “a very possible price for crude in the coming weeks” given the intra-day high of last Friday. There had been speculation over recent weeks that crude price would also hit a possible US$200 by year-end.

“Besides the supply and demand fundamentals, there’re the continuing geopolitical concerns such as Iran’s regional ambitions, unrest in Nigeria’s oil-producing delta region and a five-day strike by workers in Brazil’s offshore Campos basin,” he said.