4th Floor, Petrovietnam Tower, 05 Le Duan Street - District 1 - HCMC
Tel.: (84-8) 39100108 - Fax: (84-8) 39100097 - Website: www.pgs.com.vn

ANNUAL
REPORT

SUSTAINABLE GROWTH - RELIABLE BRAND




TABLE OF CONTENTS
MESSAGE FROM THE CHAIRMAN
OF BOARD OF DIRECTORS
OVERVIEW OF PV GAS SOUTH
General information
History of establishment and development
Major achievements
Industry sectors and business locations
Major products
Business capabilities
Company’s position
Business models
Organization and Personnel
Introduction of Board of Directors
Introduction of Board of Supervisors
Introduction of Board of Managers and Chief Accountant
Employees structure

SUMMARY OF BUSINESS PERFORMANCE IN 2014
Business situation

Business results in 2014
Investment, project execution
Financial situation

REPORT OF LEADERS
Report of Board of Directors
Report of Board of Managers

BUSINESS PLAN IN 2015
Business plan in 2015
Solutions to achieve target in 2015

INTRODUCTION TO MEMBER COMPANIES
Related companies
Distribution system

CORPORATE GOVERNMENT
Operation of Board of Directors
Operation of Supervisory Board
Transaction, remuneration, and other benefits of BOD,
Supervisory Board, and Board of Managers
Shareholders’ information
Risk management

DEVELOPMENT STRATEGY IN 2015
Objectives – Strategies
Long-term development plan

SUSTAINABLE DEVELOPMENT
Responsibilities to Investors

Responsibilities to Employees
Responsibilities to Society
Responsibilities to Environment
Community activities

AUDITED FINANCIAL STATEMENTS
Consolidated financial statements


LIST OF ABBREVIATIONS
LPG: Liquefied Petroleum Gas (Also known as Gas)
CNG: Compressed Natural Gas
Dry Gas: Dry gas is a natural gas or associalisted gas which has been
treated to remove mechanical impurities, water, bupro and condensate in
the gas processing plant. Its main composition is methane (CH4)
PVN: Vietnam Oil and Gas Group
PV Gas: PetroVietnam Gas Joint Stock Corporation
PV Gas D: PetroVietnam Low Pressure Gas Joint Stock Company
PV Gas South: PetroVietnam Southern Gas Joint Stock Company
CNG Vietnam: CNG Vietnam Joint Stock Company
VT-Gas: Vietnam Liquefied Petroleum Gas Co. Ltd.
PV Gas SaiGon: PetroVietnam Eastern Gas Co. Ltd.
PV Gas Cylinder: PVGas Cylinder Factory
CP Price: Contractual price that Aramco Company (Arap) announces of
the beginning of each month and applies to the month of delivery.
AGM: Annual General Meeting
Staff: Officers - Employees - Workers
BoD: Board of Director
BoM: Board of Managers



MESSAGE FROM THE CHAIRMAN OF BOARD OF DIRECTORS
Dear our valued shareholders and customers!
In 2014, PV Gas South has implemented its production and operation plans with a mixture of favorable conditions and obstacles. On the one hand,
there have been some certain advantages such as
supplies, capital, infrastructure, brand name, etc.
On the other hand, PV Gas South has still encountered lots of disadvantages like prolonged
economy crisis, stagnant manufacturing, reduced
LPG demand, high inventory, CP fluctuation not
following any rules; as a matter of fact, CP reduced
sharply in December 2014 by 52% in comparison
with December 2013; intense competition due to
other LPG traders applying good support for
agents and stores; there has still remained commercial fraud in LPG business in most of markets while
the punishment has not been strong enough; the
world’s oil price has continuously lowered especially months of year end; price of input CNG, by
contrast, has increased, customers have moved to
substitutes such as Biomass, coal due to more competitive price.
In a context of both disadvantages and advantages,
PV Gas South has concentrated all resources,
actively and flexibly managed along with all PV Gas
South’s staff’s resolution. That’s the reason why It’s
operation tasks, business targets of the year of 2014
were fiercely implemented and the final results
exceed its plan numbers, pursued closely Resolution approved by AGM 2014 as follows:
- LPG output reached 236,893 tons, exceeding
11.22% of 2014 target
- CNG output reached 159 million m3 , exceeding
14.67% of 2014 target
- Total revenue reached 7,657.77 billion dong,

exceeding 12.86% of 2014 target
- Profit before tax reached 246.61 billion dong,
exceeding 26,92% of 2014 target

Chairman of BoD of PV Gas South
Do Tan


- Profit before tax reached 246.61 billion dong,
exceeding 26,92% of 2014 target
- Profit after tax reached 191.5 billion dong, exceed
ing 16,98% of 2014 target
- The rate of Returns/Charter capital reached
50.39%.
In the 2015 coming, even though it is forecast that
the world’s economy will be better, there have
existed lots of risk factors, and in unstable condition, especially the unpredictable fluctuation of oil
price, the world’s CP, etc. Such factors are latent,
affecting PV Gas South’s business operations. With
different oil price forecast, PV Gas South has
prepared its business operation target, financial
plan for 2015 with the goal of operation effectiveness utilization. PV Gas South key and crucial tasks
for 2015 and incoming years are as follows:
Firstly, safe, stable and effective operating the
system of depots, extraction station, and infrastructure of LPG, CNG; continuous LPG and CNG supply
to Customers.
Secondly, regarding LPG business operation: stay
the leading civil LPG trading unit in the South area;
reinforce and develop the markets which are competitive and have brought about business effectiveness; expand potential consumption market.
Regarding CNG: establish consumption network on

the whole country; negotiate and make a flexible
price policy to convince customers switching their
current fuel into CNG; use CNG widely in transportation and industrial manufacturing; Research and
development the product of LNP as PV Gas South’s
new product line.
Thirdly, improve the quality of after sales service.
Fourthly, continue to investment, amend, expand
LPG and CNG infrastructure to fulfil market
demand.

Finally, determine properly capital demand for
each phase, ensuring reasonable and effective
capital structure in order to pursue investment
projects, making sure that PV Gas South’s business
plans are executed in financially active condition,
conserving and developing investment capital.
Although there exist lots of obstacles, with proper
and consistent business strategy as well as clearly
operating, associating company’s benefits with
shareholders’ welfares; PVN’s concerns, timely
support from PV Gas – parent company, I do believe
that PV Gas South will continue to firmly step up,
show that PV Gas South is strong enough to overcome hinders to make accomplishment in the near
future.
On be half of Board of Directors, I would like to
thank our valued customers and clients for close
coordination cooperation, and shareholders for
belief, trust, and support. Especially, I highly appreciate all PV Gas South’s staff for their tireless and
important contribution to the success of PV Gas
South over the year, their effort for its firm status in

the industry today. Thus, PV Gas South keep its solid
position of Vietnam’s leading enterprise as well as
brand of “PETROVIETNAM GAS”.
Best regards with success,
Chairman of BoD of PV Gas South
Do Tan


OVERVIEW OF PV GAS SOUTH
General information
History of Establishment and Development
Major achievements
Sectors and Business areas
Main products
Business capacity
Company’s position
Business Model
Organization and Personnel


GENERAL INFORMATION
PETROVIETNAM SOUTHERN GAS JOINT STOCK COMPANY
(PV Gas South)
Head office: 4th floor, PetroVietnam Tower,
No. 1 - 5 Le Duan, Ben Nghe Ward, District 1, HCMC
Tel: (84.8) 39100108 - 39100324
Fax: (84.8) 39100097 - 39100325
Website:
Business Registration Certificate: 0305097236
Charter Capital: 380,000,000,000 VND

Date listed on HNX: 15/11/2007
Stock code: PGS


MEMORABLE MILESTONES
PVGas South’s predecessor
On March 28th 2000, Gas Trading Southern Enterprise directly under Gas Processing and Trading Company (PV Gas), PV Gas South’s predecessor, was established under the Decision No.
389/QD-HDQT issued by Board of Directors of PetroVietnam Corporation (currently known as
PetroVietnam)

PV Gas South established
On April 12th 2006, Board of Directors of PetroVietnam Corporation (PetroVietnam Group) signed
Decision No. 825/QD-DKVN on the establishment of PetroVietnam Southern Gas Company (PV Gas
South) on the basis of the Gas Trading Southern Enterprise directly under Gas Processing and Trading Company (PV Gas) and LPG Business Division of Oil and Gas Trading Company (Petechim)

PV Gas South transformed into Joint stock company
On July 23rd 2007, PetroVietnam Southern Gas Joint Stock Company celebrated its first annual
general meeting. When completing legal procedures, Company official come into operation since
July 25th 2007.
PV Gas South Shares listed
Carrying out AGM Resolution, Company’s Board of Directors implemented plan to legally list
Company’s shares on the Hanoi Stock Exchange. With support of PetroVietnam Securities Joint
Stock Company as listing consultant, Company finalized its prospectus and other legal documents
to list its shares on the stock exchange.
On November 15th 2007, Company’s shares was officially listed on Hanoi Stock Exchange with
stock code of PGS.


PETROVIETNAMGAS-Trustworthy Brand
Since the date of establishment on 2000, with sales level of only 5,000 ton and sale

revenue of 15 billion dong per year, after more than 14 years of operation, with guideline of “Safety – Quality – Efficiency” , PetroVietnam Southern Gas Joint Stock Company
has become one of Vietnam’s leading Liquefied Gas businesses. PV Gas South’s network
of business covers all provinces and cities in the Southern area. Nowadays, Company’s
output has reached 200,000 ton per year and sale revenue has reached 7,000 billion
dong per year and continues to fast grow in the near future.
In order to catch up with global integration trend and enhance management efficiency
as well as ensure safety in business activities, PV Gas South has successfully built up
quality management and safety management which were recognized by British Standards Institution (BSI) with certificate of Quality management system of ISO 9001:2008,
Environmental management system of ISO 14001:2004 and Safety management with
standard of OHSAS 18001:2007, respectively. Most recently, Company was certified
with integrated management system of PAS 99:2006 coming into effect since March
2013 till March 2016.
PetroVietnam Southern Gas Joint Stock Company has been investing in setting up storage depots and filling station in Southern provinces for market expansion, taking initiative in supply to fullfil customer demand.
With business guideline of “always customers oriented”, PV Gas South
always a trustworthy partner for domestic and foreign companies,
a reliable brand for consumers.


MAJOR ACHIEVEMENTS

- Company was awarded
with prize of being one of
“The most 30 transparent
enterprises” by Hanoi Stock
Exchange 2013-2014.

Second-class Labor Medal, 2012

Unit with outstanding achievements in 2014


- Continue the success in
2013, Company ranked
14th of the “Top 50 of Vietnam most effective enterprises” in 2014 awarded by
Nhip Cau Dau Tu magazine
voting hosting. This is the
3rd year of PV Gas South
being awarded which confirms that PV Gas South is a
big, sustainable and effective enterprise. The program purpose is to seek
and rank listing companies
whose significant achievements in their business indicated from basic financial
ratios.
- Awarded with “Top 50 of
best annual reports in 2014
” hosted by Ho Chi Minh
Stock Exchange and Dau Tu
Chung Khoan newspaper.

Top 50 of Vietnam most effec tive enterprises in 2011, 2012, 2013
Top 50 of best annual reports in 2011, 2012, 2013, 2014


INDUSTRY SECTORS AND BUSINESS LOCATIONS
Industry sectors:
Trade, import and export petroleum products: gas, materials, equipment,
and vehicles used for transportation, storage, cylinder bottled, and LPG
trading.
Trade CNG: materials, equipment, vehicles used for transportation, storage,
CNG trading.
Design, construct, and consult investments on projects of liquefied petroleum gas, industrial gas, technology transfer, business operators, maintenance of civil works related to liquefied petroleum gas.
Transport liquefied petroleum gas, fill and extract LPG, and other services

related to LPG and gas products used for industrial, civil and transportation
purposes.
Trade petroleum, viscid oil, and other additives related to petroleum and
viscid oil.
Do business in fertilizer, real estate, palletizing.
Manufacture tank, basin, and metal containers.
Repair fabricated metal products.


Business locations:
PVGas South owns wide network of
business for both LPG and CNG.

LPG filling and extraction system

PV Gas South’s Business network of LPG
has up-to-now covered all provinces from
Da Nang to Ca Mau, including storage
depots, LPG filling stations in Southern
area. As to Ho Chi Minh, a major market of
cylinder consumption, PV Gas South
focused on building up satellite filling
and extraction systems allocated evenly
throughout Southwest, Southcentral,
Southeast markets. At the same time,
Company also sets up head system of LPG
distribution agency to periodically meet
and exchange policies so as to
strengthen, promote and unify price
level, enhance distribution system and

competitive capabilities.
Regarding CNG business, PV Gas South
currently manages 3 mother stations of
CNG My Xuan A (Ba Ria – Vung Tau), Hiep
Phuoc (Ho Chi Minh), and compressed
gas station Phu My I (Ba Ria – Vung Tau)
which is of CNG Vietnam Subsidiary with
total design capacity of 215 million m3.
Major CNG consumers are industries like
steel, construction materials, bricks,
ceramics, and so on in the Southern area,
which are located within 200 km far from
the factory. Current CNG distribution policies are quite flexible, depending on the
features and customers’ requirements of
gas receiving, tank truck can move into
areas of rough terrain.
It is the wide distribution and business
network that PV Gas South is able to
expand market, take initiative in supply
and well serve its customers.

Locations of CNG mother stations



MAJOR PRODUCTS
LPG products

45kg cylinder
LPG 45kg cylinder

Users: 45kg cylinder is mainly for consuming
purpose with small scale but high frequency of
using like in restaurants, hotels, schools, collective kitchens, factories with small to medium
scale of production.
Weight of cover: 37-40 kg
Weight of LPG: 45kg ÷ 200gram
Manufacturing standard: DOT-4BW-240
Cover material: manufactured with steel
imported from Japan ensuring standards of
DOT-4BW-240 and Vietnamese standards of
QCVN 04:2013/BCT issued on September 15th
2013. The cylinder can endure pressure when
containing and transporting LPG at the pressure
state which was verified and certified with safety
and allowed to be circulated and used.

12kg cylinder
LPG 12kg cylinder
Users: 12kg cylinder is mainly for consuming
purpose with small scale like households’ daily
usage, small eateries, small businesses using gas
fuel.
Weight of cover: 13.5-14.5 kg
Weight of LPG: 12kg ÷ 100gram
Manufacturing standard: DOT-4BA-240
Cover material: manufactured with steel
imported from Japan ensuring standards of
DOT-4BA-240 and Vietnamese standards of
QCVN 04:2013/BCT issued on September 15th
2013. The cylinder can endure pressure when

containing and transporting LPG at the pressure
state which was verified and certified with safety
and allowed to be circulated and used.

LPG pipeline:
This type of LPG is sold to factories, manufacturing areas, gas trading companies by tankers.


CNG products
CNG is compressed natural gas with main component of CH4 – methane (accounting for 85-95%)
which is extracted from natural gas mines, oil (associated gas) mines or gas plant (obtained in the
process of production of the refinery), processed and compressed at high pressure (200 to 250 bar)
for storage in special tank and transported to consumption places such as plants using thermal
energy and apartment buildings, and so on. bBecause components are simple and easy to process
to remove toxic mixture like Sox, Nox, CO2 , without benzene and aromatic hydrocarbon, when this
fuel fires, there is not much of SO2 , NO2 , CO2 , etc. and does not release dirt. Therefore, using CNG
as a substitute for traditional fuels like coal, oil, will contribute to protect environment and cut cost.

Petroleum/ viscid oil products
Petroleum: is a fuel processed from petrochemical technology. Petroleum can be produced domestically or by import from overseas. Categories, quality are determined by producer on the basis of
market demand and regulations in Vietnam.
Lube/Grease: are lubricants for engines, produced mainly from mineral oil. After being processed,
the products are packed in barrels, loncan, box, etc. to preserve and sell to the market,. mModels,
categories, quality of product are determined by producers on the basis of market demand and
regulations in Vietnam.
PV Gas South’s petroleum business is mainly conducted by trading petroleum in domestic market
consisting of both wholesale and retail.
Wholesale: Trade with large quantity, or deliver by special vehicle (tankers) to customers.
Retail: Trade with small quantity directly to customers at petroleum stores or where customers
require (negotiated).



BUSINESS CAPACITY
Nowadays, PV Gas South has 31 extraction and filling stations with total capacity of 24,580
tons/month from Da Nang to Ca Mau among which 16 stations belong to PV Gas South with
total capacity of 12,900 tons per month and the other 15 stations are of monthly hiring. Except
for 16 LPG extraction and filling stations, PV Gas South currently owns 04 warehouses with total
capacity of 7,700 tons. In the coming time, PV Gas South is going to build up warehouses and
extraction and filling stations in the Middle area, South east, and South west area.
Up to now, PV Gas South has invested Compressed CNG filling station to supply transportation
and industrial manufacturing. This is a new sector and highly potential. Its designed capacity is
215 million m3 gas per year, among which the parent company with 2 industrial zones named
My Xuan and Hiep Phuoc is of designed capacity of 100 million m3 gas per year and 20 million
m3 gas per year respectively, and CNG Vietnam – Phu My Industrial zone is of the design capacity of 95 million m3 gas per year.

System of wharves,
storage of LPG and
extraction and filling
stations of PV Gas South
in southern provinces


List of PV Gas South storage depots and extraction and filling stations
No.

Item

Address

Total capacity


Storage depots (MT)

Can Tho Warehouse

Lot II.5, II.6, Tra Noc II industrial park, Can Tho City

1,200

Go Dau Warehouse

Go Dau A Port, Phuoc Thai Commune,
Long Thanh District, Dong Nai Province

4,000

VT-Gas Dong Nai Warehouse

Dong Nai Port, Long Binh Tan Ward,
Bien Hoa City, Dong Nai Province

1,000

Dung Quat Warehouse

Eastern Dung Quat Industrial Park, Binh Thuan,
Binh Son district, Quang Ngai Province

1,500


Total

7,700

Capacity of
filling and extraction
(Ton/ month)

LPG filling station
(Ton)

Lot D1/1 Street 1B, Vinh Loc Industrial Park,
Binh Hung Hoa B, Binh Tan District, HCM

1,000

Highway No. 55, Thanh Binh, Dat Do Town,
Ba Ria Vung Tau Province

500

Dong Xuyen Industrial Park, Ba Ria-Vung Tau

600

Lot II.5, II.6, Tra Noc II Industrial Park, Can Tho City
Tan My Chanh Industrial Park, Ward 9, Tien Giang Province

400


157 Xom Nui, Vinh Phương Commune, Nha Trang City

600

Lot D6-01, Nhon Hoi Industrial Park (Zone A), Nhon Hoi
Economic Zone, Quy Nhon City, Binh Dinh Province

500

Tuyet Diem Hamlet, Binh Thuan Commnune,
Binh Son District, Quang Ngai Province

1,500

Lot 4, Tra Da Industrial Park, Tra da Commune,
Pleiku City, Gia Lai Province

500

Lot G, Street N4, Bac Dong Phu Industrial Park, Tan Phu Town,
Dong Phu District, Binh Phuoc Province

500

262 Nguyen Luong Bang, Hoa Thanh Commune, Tay Ninh

500

Km No. 11, Highway 14, Hoa Phu Commune,
Buon Me Thuot City, Dak Lak Province


600

Quan Ngang Industrial Park, Gio Linh, Quang Tri Province
Dong Nai Port, Long Binh Tan Ward, Bien Hoa City,
Dong Nai Province

Total

2,000

400
2,500

Lot BI – 11 Phu Hoi Industrial Park, Duc Trong District, Lam Dong

400

Lien Chieu Industrial Park, Hai Chau, Da Nang

400
12,900


CNG compressed gas supply at PV Gas South


System of CNG mother stations and daughter stations at PV Gas South
Management unit


Project

I. CNG mother station
My Xuan CNG Station

Hiep Phuoc CNG Station

Phu My I Industrial Park
CNG Station
II. CNG Daughter stations
II. CNG Daughter stations
Parent company – PV Gas South

Daughter station
(gas fillingstation for buses)
Pho Quang Street

Parent company – PV Gas South

Daughter station at
449 Nguyen An Ninh, Vung Tau
Parent company – PV Gas South
Daughter station at
654 Nguyen An Ninh, Vung Tau
Parent company – PV Gas South

Daughter station at Tan Kien,
Binh Chanh, HCMC

Parent company – PV Gas South


Daughter station at
An Suong, HCMC

Parent company – PV Gas South

Mobile Refuelling Unit at
My Xuan

Parent company – PV Gas South

Daughter station at
Ho Chi Minh National University

Total capacity
(million m3/year)

Notes
Completed and put
into operation in 2010
with initial capacity of
50 million m3, it is now
expanded.
Completed and put
into operation of first
phase in 2011.
CompleteaCompleted
and put into operation
in 2010 with initial
capacity of 50 million

m3, it is now expanded.
d and put into operation of first phase in
2011.



COMPANY’S POSITION
Since the establishment, PV Gas South has identified its strategic objectives to develop a focal
wholesale business of LPG in the Southern market, contributing to the overall development of the
industry. Over the last few years, PV Gas South’s production and business activities have constantly grown, which put significant impacts on Southern market, building up brand reputation of
PETROVIETNAM GAS. In the context of increasingly competitive market of Civil LPG (cylinder LPG)
and industrial LPG (LPG pipeline) with the existence of the world’s fuel companies, PV Gas South’s
market share has still been leading company among LPG sellers in Southern area with 34.50%,
increasing by 1% compared to 2013. This achievement thanks to following advantages:
Human resource
PV Gas South owns skilled and qualified staff force. Company’s staff, especially operational staff
are trained in vocational colleges specializing in oil and gas industry, 100% operational workers
hold certificate of safe operation of technical equipment under pressure.
Technology
During operation, Company has always focused on the quality of growth, ensured safety in
production and trading. Especially, in 2013, Company was certified with integrated management
system PAS 99:2006 on trading LPG and CNG which came into effect between 3/2013 and 3/2016,
consisting of: safety and occupational health management system according to the standard of BS
OHSAS 18001:2007, quality management system according to the standard of ISO 9001:2008,
environment management system of ISO 14001:2004. Especially, Company sets up and successfully apply corporate operating management (COS) contributing to build up corporate culture and
save management cost.


Dominant position
Regardless of an increasingly severe competition, PV

Gas South’s market share has been still at the top position in the Southern area which sustainably maintains
at 34% of total market.
Branding
Over the last years, Company has always made its own
effort to find out and develop suitable suitable policies
of price, distribution, customers, hence, it becomes
one of the largest businesses in the Southern area,
positioning brand of PETROVIETNAM GAS, contributing to ensure safe production of Dinh Co gas processing factory and Dung Quat Oil Refinery factory.
Besides Gas business, Company has done business
involving related gas products like CNG, petro, oil,
lube, gas using accessories used for daily consumption
and industrial activities, installing and maintenance
industrial Gas systems, which enables Company’s business diversification.
Distribution
Up to now, company’s LPG network has covered all
provinces in the Southern area. LPG cylinder retail
output has reached from 12,000 ton to 13,000 ton per
month, LPG pipeline output has reached from 7,000 to
8,000 ton per month, which position Brand of “PETROVIETNAM GAS” in the Southern Market.
With its own financial advantage, Company made
investment in focal wholesale storage depot and
ports, total storage capacity of PV Gas South’s warehouses is now approximately 7,700 ton and it plans to
increase by 6,000 ton by the end of 2021.
Support from PetroVietnam National Group and
PetroVietnam Corporation
As a member of PetroVietnam National gGroup, PV Gas
South gets support in terms of expertise and participates in business projects as well as trade products of
the Group’s members. Company has the opportunity
to receive, process and trade LPG from Dung Quat Oil
Refinery and other oil refineries to meet market

demand, increase initiative in sources of goods in
nationwide LPG market.
In addition, PV Gas South is also guaranteed with raw
material supply and other preferential on acquiring
raw materials from the Group’s oil refineries and gas
plants. Such advantages along with company’s significant market share (more than 30%) and wide network
of distribution across the region will ensure that PV
Gas South may increasingly expand and sustainably
develop.