The VND2.3 trillion (US$110.4 million) loss Petrolimex posted from the fuel business last year mainly resulted from the price stabilization policy, said Tran Ngoc Nam, deputy CEO of the country’s largest fuel wholesaler. The state-run company, fully known as the Vietnam National Petroleum Group, incurred a combined pre-tax loss of more than VND1.4 trillion last year, after the VND2.3-trillion loss from the fuel sector was partially covered by profits from its other businesses, the State Audit of Vietnam said in its report on the 2011 financial status of Petrolimex. “In 2011 Petrolimex mostly suffered losses from the fuel price stabilization sector, which is confirmed in the SAV report,” Nam told Tuoi Tre. “Generally speaking, Petrolimex has been operating with profits over the last few years in every sector but the fuel business.” The auditors also pointed out that Petrolimex has not adequately managed the fuel loss rate, sending the losses of the company to as much as VND189 a liter of gasoline, or kilogram of oil. But Nam said this is a matter of calculation. Other fuel wholesalers calculate the incurred loss expense starting from the departure of the fuel shipment from the exporting country to its arrival in Vietnamese ports, while in the case of Petrolimex, the calculation extends to encompass the duration ending in purchase by end-consumers, hence higher losses, he explained. Petrolimex is selling fuel in 62 out of the country’s 63 cities and provinces, some of which are in very remote areas, which results in high transport costs, he added.Other justifications Nam also justified another detail in the audit report, which said Petrolimex has earmarked as much as VND1 billion to buy the golf memberships for its chief officials. The purchase is real, but it was not done at Petrolimex headquarters, but a transporting company where it holds a 51 percent stake, he said. “The purchase was considered an investment to facilitate the company’s business, but we have transferred the memberships to other people and revoked all the money,” he claimed. Meanwhile, commenting on the VND20.7 million ($1,000) salary the company has been granting to its chiefs despite the losses, Nam said the executives deserve such high wages given their huge workload. Petrolimex headquarters is in fact managing the operations of 42 limited companies with 26 branches and plants, and nearly 2,200 filling stations across the country. “This is not to mention two overseas companies and 26 firms where Petrolimex holds the controlling interests,” he added.