Vietnam’s oil and gas sector will become the focus of the petroleum industry with many projects to be developed by oil conglomerates coming from the U.S., Russia, and Japan in the coming time.
Those developments, ranging from the upgrade of the Southeast Asian country’s sole oil refinery to the operation of a big gas field, are about to change the face of the local petroleum sector.
On Friday, Nguyen Hoai Giang, general director of Binh Son Refining and Petrochemical Company (BSR) which manages Dung Quat Oil Refinery in the central province of Quang Ngai, told Tuoi Tre (Youth) newspaper that his firm is negotiating with Russia’s Gazprom Neft about the possible expansion of that only refining facility.
The Russian side has formulated many plans corresponding to the funding Gazprom Neft can provide, which ranges between US$1.5-3 billion, Giang said.
The budget will enable the Russian oil and gas conglomerate to acquire a 49 percent stake in Dung Quat Oil Refinery besides helping upgrade the capacity of the plant by 54 percent to about 10 million tons of crude oil per year.
But Gazprom Neft has yet to decide on the exact amount of money to be spent on the acquisition and upgrade of the refinery, Giang said, adding that the Vietnamese side prefers a $2 billion investment plan proposed by the Russian giant for the expansion.
In June this year, Gazprom Neft suggested expanding and increasing the capacity of Dung Quat Oil Refinery to 10 million tons per year with an investment of up to $3 billion.
The proposal came during a working session on an investment cooperation plan for the upgrade of Dung Quat Oil Refinery, which was attended by a Gazprom Neft delegation led by general director A. B. Dyukov and the state-owned Vietnam Oil and Gas Group (PetroVietnam).
On Friday, Do Van Hau, PetroVietnam CEO, told Bloomberg that the Vietnamese group may reach an agreement next year with U.S.-based Exxon Mobil on a $10 billion natural gas and power project, the country’s biggest of its kind.
Hau said the Southeast Asian country received a boost from Exxon Mobil’s gas discovery off Vietnam’s coast in 2012, which will support its plans to develop its natural gas fields, estimated to be the fourth-largest in East Asia.
The first phase of the mammoth project would pipe gas from the field to a processing station from which it will be used to fuel a 2,500 megawatt power plant, Hau told Bloomberg, adding that the power plant is one of the country’s biggest so far and will help curb electricity shortages.
On Tuesday last week, ReutersReutersReuters reported.
The finds were confirmed in the wake of drilling tests conducted in May and August, in addition to the discovery of gas and condensate at other wells drilled in the blocks, the company said.
Overseas expansion
On Thursday, Thomson Reuters said that PetroVietnam is in talks with banks for a seven-year loan of up to $1.8 billion to back its bid to buy a stake in Murphy Oil Corp’s Malaysian oil and gas assets.
ReutersThomson Reuters said, without giving the details.
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