Under fierce competitive pressure from rivals, in the past years, PetroVietnam Drilling & Well Services Corporation (PV Drilling) has still managed to uphold the brand name "Pioneer of Vietnam drillers” and confidently asserted its position with prestigious domestic and international awards. In spite of being very busy at the end of the year, PV Drilling General Director Pham Tien Dung gives us a time to share his thoughts. “Never surrendering to hardships, PV Drilling’s drillers are devoting themselves to offshore rigs on the rough sea and keeping their efforts like flat and sharp pitches on the epic of Vietnamese oil and gas industry,” he said. Anh Dao reports.
As a leader of a big company like PV Drilling, you must be under considerable pressure when you have to steer PV Drilling to assert its position in the domestic drilling market and expand its operations to foreign markets.
In recent years, competition on drilling rig supply market as well as drilling-related services tends to increase. Competitors’ launch of old drilling rigs has placed huge pressures and difficulties on PV Drilling in expanding the domestic market, especially when price competition prevails. At the same time, the sharp decline in oil prices in late 2014, possibly lasting until 2015, or even 2016, has forced oil companies to reduce future drilling plans and most oil companies in Vietnam and in the world have to cut budgets and expenses to cope. Besides, the sharp increase in newly fabricated drilling platforms in 2014 has also intensified competition due to oversupply. This will lead to a decline in short-term drilling prices and trouble PV Drilling in maintaining the market share and seek for new contracts. In addition, overseas offshore services development is also meeting difficulties due to growing competition from multinational and domestic companies, protectionist barriers, customs and cultures of host countries.
Facing those difficulties, with its efforts and determinations, PV Drilling tightened budget control, effectively carried out drilling and well services, and completed and surpassed production and business plans in 2014. All consolidated financial indicators of PV Drilling were very optimistic and growing. Revenue exceeded the yearly plan by 42 percent to VND19,500 billion, profit before tax surpassed the full-year plan by 42 percent to VND3,050 billion, profit after tax beat the plan by 39 percent to reach VND2,300 billion, and tax payment to the State budget exceeded the annual plan by 77 percent to VND3,200 billion.
Needless to say, to obtain those impressive growths, PV Drilling is experiencing a lot of pressure. But, with a strong determination and high focus on the effective development of core services, we successfully completed our objectives. Specifically, operations of PV Drilling-owned rigs continued to be safely operated with high efficiency (over 99 percent) while the number of rigs in cooperation with other partners also exceeded initial estimations, resulting in an increase in manpower and expertise. The corporation also saw an increase in revenue and the proportion of well services (mud logging, geophysical wells and tubular, etc.), thus bringing this proportion in the corporation’s total profit from 16 percent in 2013 to 19 percent in 2014.
In investment, PV Drilling continued to build PV DRILLING VI to ensure the set progress. This rig is expected to be handed over to PVEP POC in the second quarter of 2015. Besides, PV Drilling purchased a lot of assets and equipment to enhance labour productivity and technical services quality.
Human resource is the core factor to the success and existence of every business. How has PV Drilling awarded the great contributions of its employees to the powerful development of the corporation?
In PV Drilling, the human factor is always a top priority and an integral element of sustainable development strategy. So, the corporation always has remunerations and compensations policies to encourage and motivate its employees based on their performances. Currently, PV Drilling is one of the first units of the Vietnam National Oil and Gas Group (PetroVietnam) to apply effect-proven performance and market-based pay policies.
In addition to reasonable pay policies, welfare policies are also applied by the corporation. All employees are insured of health, using PVI Care, with high coverage value and annual health checks. All employees are awarded bonuses and allowances during special days. Especially, PV Drilling has also implemented the employee stock ownership plan (ESOP) and bonus shares, sourced fro treasury shares of the corporation, to employees to strengthen their loyalty and encourage their greater contributions as well as prepare human resources for its sustainable development.
Besides, in 2014, PV Drilling joined hands with PVI Sunlife to implement pension insurance plans for all employees. This programme is a very significant help to all employees of PV Drilling to build saving plans for the retirement time. With such practical and meaningful policies, PV Drilling is always highly appreciated by PetroVietnam for its good and compensation remuneration policies.
As a senior executive, can you have any valuable experience to share with young entrepreneurs today?
After 13 years working as an executive and four years as CEO of PV Drilling, I think the human is still the most important factor to attain the highest efficiency in business administration. His Excellency Matsushita Konosuke - the god of management of Japan - said “The most valuable asset of a company is humans.”
In PV Drilling, we believe that the today success is the result of a collective rather than any individual. Therefore, we focus on human investment by creating good employment, pay, reward, welfare policies, career opportunities and promotion opportunities.
Besides, to identify, nurture and retain talents and build a friendly working environment also help maximise individual capabilities. By using insurance health policies for employees and dependents (PVI Care, PVI Sunlife), PV Drilling has also created a consensus and connectivity among people, who are always determined to devote themselves to the development and sustainability of PV Drilling.
Drilling is a very specific sector. Recruitment, employment and training of technical staff are often time-consuming and costly. With its consistent policies, PV Drilling has minimised brain drain from attractive offers from foreign oil companies.
We always believe that an effective corporate governance system is made by humans. Hence, putting right man in right place is a premise for creating a good and effective governance system. With that philosophy, the corporate governance system we have built is helping us on the way of pursuing sustainable and effective development. Nevertheless, to keep the system to be implemented seriously and improved constantly, this requires the art of business leaders in personnel arrangement and assignments.
In 2015, each economic sector will have certain opportunities and challenges. As an insider expert, how do you assess challenges of the oil and gas industry in 2015? In that context, how will PV Drilling overcome challenges and capture every opportunity?
In fact, the drop of world crude oil prices to below US$50 per barrel since the end of 2014 has had significant impacts on PetroVietnam and its members, international oil companies and oil and gas service contractors. However, after clearly identifying these challenges, we have deliberately set out optimal schemes to cope with new situations. The leadership of PV Drilling has directed its member units to study and calculate service prices to the most reasonable level to ensure the mutual benefits for both sides. Current challenges will be pressures as well as motivations for us to review and optimise the system to bring our intellect and prowess into full play. In addition, this is also the opportunity for customers and service providers to get closer together and strengthen the spirit of cohesion, cooperation and mutual development which has become a good tradition of the drilling industry in particular and of the oil and gas industry in general.
By clearly identifying advantages and challenges, in 2015, PV Drilling will strive to complete its business targets registered with PetroVietnam and its shareholders while maintaining the sustainable development of the corporation. The firm will integrate production and business operations with the safeguard of national sovereignty and security and environmental protection; apply social security and community sharing policies to promote the development of the country, thus helping enhance competitiveness of PV Drilling in particular and of the Vietnamese oil and gas industry in general on international arenas.
On the occasion of the New Year, the Year of Goat, do you have any message to those engaged in the oil and gas industry?
On the occasion of Lunar New Year 2015, the Year of Goat, on behalf of PV Drilling, I wish all companies to overcome every hardship, difficulty and challenge, take challenges as opportunities to survive and grow to increase contributions to the national development. For its part, PetroVietnam will continue to uphold its leading position of the national economy, and contribute more to the cause of the socioeconomic construction, development and prosperity of the nation.
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