An oil rig of PetroVietnam. Photo credit: VnEconomy
Vietnam's national gas and oil group, better known as PetroVietnam, has recently forecast a "serious" funding shortfall of about VND70 trillion (US$3.16 billion) to develop government-approved projects over the next five years, news website VnEconomy reported on Thursday.
The group was quoted as blaming a two-year-old policy which only allows state-owned enterprises to invest up to 30 percent of their net profits in new projects. The rest of their profits must be sent to the government.
PetroVietnam's revenues were hurt by recent sharp declines in crude oil's prices. Brent crude fell from $112 per barrel in 2013 to around $56.54 last month.
It also complained about increased difficulties in operating oil and gas projects like higher costs and tensions in the East Sea. Several projects have been lagging behind deadlines and becoming more costly, it said.
The group said since it took over debt-ridden companies and projects from other state enterprises, particularly the troubled shipbuilding giant Vinashin, its financial burdens have increased too.
It also expected difficulties in taking loans from banks.
PetroVietnam estimated that it will have to spend a total of VND783 trillion ($35.41 billion) on the development of Vietnam's oil and gas industry between 2016-2020 under a plan approved by the government.
More than 44 percent of the fund will be spent on oil and gas exploration and exploitation activities, while other target sectors included gas industry, and oil and gas services, according to the website.
PetroVietnam reported VND46 trillion ($2.08 billion) in net profits last year, and submitted VND178.1 trillion ($8.05 billion) to the state budget.