Rising LNG sales bump Petronas’ profit in volatile market

Malaysian energy giant Petronas reported rising liquefied natural gas (LNG) sales in the first half of the year despite challenging conditions and lower commodity prices.

Total LNG sales volume for the first half of 2019 was 5 percent higher as compared to the first half of 2018, reaching 15.23 million tonnes.

The higher volumes have been attributed mainly to higher volumes from the Petronas LNG Complex in Bintulu as well as higher trading activities, the company said in its report on Friday.

Petronas posted revenue of 121.1 billion Malaysian Ringgit ($28.96 billion), 3.9 billion Malaysian Ringgit above the 117.2 billion Malaysian Ringgit in the first half of 2018. The revenue jump was mainly attributed to higher sales volume for petroleum products and liquefied natural gas (LNG) as well as the effect of the weakening Ringgit against the US Dollar exchange rate.

First-half profit after tax (PAT) jumped 9 percent to 28.9 billion Malaysian Ringgit ($6.91 billion) from 26.6 billion Malaysian Ringgit in the corresponding period last year. The improved results were delivered on the back of higher revenue, but the increase was partially offset by higher product costs.

The company president and CEO Wan Zulkiflee Wan Ariffin said the company will progress with its efforts to “build the organization’s resiliency in facing anticipated prolonged market volatility and changing energy landscape.” 

Going forward Petronas expects the gas market to continue to be volatile in the second half of the year as well, amid protracted trade issues that have spread beyond the United States and China, sluggish oil demand growth as well as the slowing global economy.