PV GAS to make biggest ever IPO

PetroVietnam Gas (PV Gas) plans to sell shares in the initial public offering (IPO) representing 5-10 per cent of its equity of more than VND18.9 trillion ($1 billion). Shares representing another 15-20 per cent will be offered directly to strategic investors. PV Gas is investigating and negotiating potential strategic investors. (There have been some 40 multinational oil and gas companies and financial institutions showing interest to become the firm’s partners.)

Thi Vai Terminal

The company expects to offer 95 million shares, or 5 per cent of its total chartered capital, with an estimated price of VND31,000 ($1.6) per share.

Established in 1990 and named Gas Company, from the restructure of Vung Tau Oil and Gas Project Management Board, PV Gas is now operating in gathering, transporting, storing and trading gas and gas-based products. Shortly after its inception, PV Gas quickly built a system to gather and use gas from the Bach Ho oil field,  the Vietnamese gas industry’s first infrastructure system.

 PV Gas is the only entity in Vietnam that has modern and synchronised production infrastructure and facilities for from gathering, transporting, storing, and processing to distributing and marketing thanks to highly-trained and experienced staff.

Also, as an arm of PetroVietnam, it has made use of all the facilities operated and managed by the national giant in gathering, processing and distributing gas and gas-based products in Vietnam.

After 20 years in operation, PV Gas has helped improve Vietnam’s young gas industry’s infrastructure system by providing the Vietnamese market with 53 billion cubic metres of gas, 4.5 million tonnes of liquefied petroleum gas (LPG) and 1.3 million tonnes of condensate (light gasoline). It has played an important role in contributing to the country’s economic growth, energy and food security, and LPG pricing stabilisation, helping ease the prices of crucial consumer commodities such as electricity, petroleum, and fertilisers.

Each year, PV Gas provides nearly 8 billion m3 of gas, more than 600,000 tonnes of LPG and nearly 100,000 tonnes of condensate, ensuring the production of nearly 40 per cent of electricity, 30 per cent of fertilisers, 5 per cent of gasoline products and 70 per cent of LPG in the country.

During 2006-2010, revenue increases were secured at some 18 per cent, per year. PV Gas reported earnings of VND30 trillion ($1.6 billion) in 2009 and posted a net profit of $113.9 million. It has estimated revenues of VND36.9 trillion ($1.9 billion) in 2010 and a profit of $231.9 million.

Bui Minh Tien, deputy director at PV Gas, said that PV Gas has targeted an annual revenue growth of 18 to 20 per cent for 2011-2015. By 2015, the company plans to reach VND82.2 trillion ($4.2 billion) in earnings.

Presently, the firm is working with many multinational gas and oil companies as well as investors who have recently shown interest in holding the firm’s shares to find out the most financially strong and prestigious partners. With the forecast that Vietnam may be short of 2-4 billion m3 of gas during 2011-2015, PV Gas has been confidently investing into a series of projects together with prestigious foreign partners including England’s BP, the US’ ConocoPhillips and Chevron, Japan’s Mitsui and Thailand’s Pttep and Malaysia’s Petronas.

The key projects include Phu My-Ho Chi Minh City gas supply pipeline for the development of southern key economic triangle, Su Tu Den/Su Tu Vang-Rang Dong gas pipeline, Block B-O Mon gas pipeline, Rong-Doi Moi gas gathering project, East-West gas pipeline, Nam Con Son 2 gas pipeline, the second phase of a low pressure gas project and LPG supply warehouses. PV Gas plans to invest more than VND66 trillion ($3.4 billion) in infrastructure and expanding its gas distribution network through 2015.

PV Gas has been certified the international occupational health and safety OHSAS-18001, the international environmental management system standard IS-14001, the international quality management system standard  ISO-9001 by the British Standards Institution (BSI). During 2005-2009, PV Gas accepted and applied 250 initiatives to production and management to improve the safety and efficiency of gas activities.