Petronas suffered lower 2012 net profit, defends MISC buyout

Petroliam Nasional Bhd (Petronas), Malaysia’s state energy company, suffered a 56 per cent decline in net profit for the fourth quarter ended December 31, 2012, mainly due to suspending production in South Sudan and booking impairments on assets in Egypt.

For the quarter ended December 31, 2012, it posted a net profit of RM5.97 billion, versus the RM13.81 billion same quarter last year.

For the full year, the company's net profit fell by about 14 per cent to RM59.1 billion, while revenue rose 1 per cent to RM291 billion. The stronger revenue was mainly driven higher production (excluding Sudan) and stable oil prices.

Total production for the year was 2.01 million barrels of oil equivalent per day, compared to 2.08 million barrels a year ago.

Petronas president and chief executive officer Tan Sri Shamsul Azhar Abbas expects the oil and gas industry this year to be more or less the same like last year and highlighted that it will be focusing more on oil production this year, mainly via increasing domestic discoveries.

"We will focus more on increasing oil production this year... The production from the three fields in Iraq which we started will come on board by the fourth quarter of this year," said Shamsul Azhar during a media briefing earlier.

Petronas will pay a RM27 billion dividend to the government this year, compared to the RM28 billion it paid a year ago.

Meanwhile, Shamsul Azhar defended the company's move to buyout MISC Bhd for RM8.8 billion and stressed that the offer price was the "right price" despite criticism from minority shareholders that the price was too low.

"It's the right price... At the end of the day, it's very simple, everyone has the right to choose," he said.

Petronas offered RM5.30 per share to buy out minority shareholdings in MISC with a view to take the national shipping company private. It owns 62.67 per cent or 2.797 billion shares in MISC.