Pertamina unveils 2014 work & budget plan, targets $3.44b net profit

State-owned oil and gas firm PT Pertamina has set a net profit target of US$3.44 billion for 2014, to be driven by aggressive growth in both upstream and downstream businesses.

The company said in a statement received Friday that according to recently approved 2014 work and budget plan, revenue is projected to increase by 6 percent to $79 billion, while consolidated assets to expand by 13 percent to $52.6 billion. The statement did not provide comparative net profit figure.

Pertamina said that operating profit is projected to reach $6.67 billion. The upstream division is expected to account for more than 50 percent of the operating profit particularly contributed by higher production from existing fields, and new fields obtained via merger and acquisition.

Pertamina plans to produce about 284,000 bpd of oil, and 1,567 mmsfd of gas, or equal to 554,700 boepd. Higher production is also expected to come from the geothermal business, which is projected to increase to 3,036 GWh.

Meanwhile, the targeted higher revenue from the downstream business is projected to come from increase in sales of non-subsidized retail fuel and aviation fuel products.

The company said that the petrochemical business will also be more aggressive in the area of marketing. The same is also expected for its lubricant business, which this year was span off to become a new subsidiary called PT Pertamina Lubricants.

Pertamina said that its gas business is also forecast to grow significantly in 2014 particularly supported by a projected 374 percent jump in sales following recent synergy measures among company units to generate greater value added. The CNG business is also projected to accelerate in line with the government?s campaign for motorists to convert from petroleum fuel to gas.

The company plans capital expenditure of $7.85 billion for 2014, about 48 percent of which to be allocated for the upstream division, 22.2 percent for business expansion, 13.4 percent for the gas business, 6.4 percent for processing business, 6.1 percent for sales and marketing division, and 3.9 percent for petrochemical business and other subsidiaries.

Editing by Reiner Simanjuntak