PNOC operating profit jumps 34% to P12.28B in 2005

State-run Philippine National Oil Co. (PNOC) reported yesterday that it registered a 34-percent increase in operating income last year to P12.28 billion, from P9.2 billion in 2004.

Based on the company’s preliminary figures, the improvement in net operating income of PNOC and its subsidiaries could be attributed to higher oil, natural gas and coal prices as well as higher sales volume in 2005.

PNOC said these factors, among others, had a significant impact on its earnings.

The PNOC has five subsidiaries: PNOC-Energy Development Corp. which is engaged in geothermal development; PNOC-Exploration Corp. mainly into oil and gas exploration; PNOC Petrochemical Development Corp., the petrochemical development arm; PNOC Development and Management Corp. which is into real estate development; and PNOC Shipping and Transport Co., the shipping arm.

Revenues likewise improved by 12 percent to P28.75 billion from the previous year’s P25.65 billion.

PNOC said it’s continuing efforts to implement strict cost management schemes also helped in the improvement of its income last year.

The company was also able to improve its cost structure, reducing its operating expense by nine percent from P2.75 billion to P2.51 billion. This was achieved largely by implementing the government’s rationalization and austerity program and a disciplined investment strategy.

As a result of its strong financial performance, PNOC said it expects to pay P4.9 billion in income taxes, a 215-percent increase from the previous year’s P 1.57 billion.

Looking forward, the company’s growth opportunities are excellent. It is aggressively adding petroleum exploration acreage in the South China Sea off Palawan and developing new geothermal based power capacities in Negros.

With the completion of these new projects, the company is confident it can continue its strong financial performance and at the same time contribute to the national objective of energy self-sufficiency.

After its creation, in 1973, PNOC served as the key institution in the exploration development and utilization of indigenous energy sources.

Developments in the country, as well as the global front make it imperative for the company to get more involved in new and renewable energy activities and projects.

Today, the Philippines is the world’s largest user of wet steam technology in geothermal operations. It is ranked second to the United States in terms of total megawatts generated from geothermal energy.