Tuesday, August 21, 2007

Vietnam's future oil refinement capacity

According to the Science and Technology Agency under the Ministry of Industry, at the current consumption level, sources of traditional fuels will be exhausted in the next 40-50 years.

Around 50 countries in the world are using bio-fuels at different levels. These are fuels produced from clean vegetable oil, ethanol (extracted from maize, sugarcane, cassava), biological diesel, etc.

Last year the world produced around 50 billion liters of ethanol (75% used as fuel) compared to 38 billion liters in 2003. The output of ethanol is expected to reach around 80 billion liters in 2012. The volume of biological diesel (B100) produced in 2005 was 4 million tons and it is estimated to be around 20 million tons by 2010.

Brazil is the first nation using ethanol as fuel for industrial activities since 1970. All kinds of gas in this country are mixed with around 25% of ethanol (E25), which helps the country save more than US$2 billion. Brazil currently has around 3 million cars completely using ethanol and over 17 million others using E25.

The oil and gas potential of Vietnam is not large. It is forecast that from an exporter of energy (crude oil, coal), Vietnam will become an importer of energy in the next 15 years (imported energy is estimated to account for 11-20% of the total in 2020 and up to 50-58% in 2050). Gas for transportation accounts for up to 30% of the total demand of the country (Vietnam currently imports all its gas).

When the first oil refinery in Dung Quat, Quang Nam province, becomes operation in 2008, it will be able to supply around 5.3 million tons of gas and diesel for transportation (34% of the total demand of 15.5 to 16 million tons).

Prior to 2020, when all oil refineries with a total processing capacity of 20-22 million tons of crude oil are put into operation, they can provide 15-16 million tons of gas and diesel, accounting for 56% of the need (27-28 million tons).

Realizing the importance of developing bio-fuels, the Ministry of Industry is compiling a scheme on bio-fuel development to 2015 and the vision to 2020, aiming to produce gas E10 (gas mixed with up to 10% of alcohol) and bio-oil in order to partly replace gas and diesel.

According to the scheme, in the 2006-2010 periods, Vietnam will have access to technologies producing bio-fuels, experimentally build stations to distributes bio-fuels in some provinces, plant trees as materials for bio-fuel production, train human resources for the bio-fuel industry.

In the 2011-2015 period, the country will strongly develop bio-fuel production and partly replace traditional fuels with bio-fuels, expanding the distribution network of bio-fuels serving transportation and production, ensuring the sources of materials for the production of bio-fuel.

In the past decade, Vietnamese scientists and related sectors have been increasingly researching bio-fuels. Though there is no big technical barrier, to develop bio-fuel and encourage the use of bio-fuels at the industrial level in Vietnam, it is necessary to have government policies.

Nguyen Phu Cuong, from the Science and Technology Agency of the Ministry of Industry, said: “We need a framework investment policy on energy, especially clean energy. To make a legal foundation for investment in energy in the long run, the government needs to approve the National Policy on Energy Security, the Scheme on Bio-fuel Development and the roadmap to perform it soon. In addition, the National Assembly needs to issue the Energy Law soon while the Ministry of Science and Technology needs to quickly develop the National Scientific and Technological Program on Bio-fuel to submit to the Government for approval.”

The success of the bio-fuel use program depends on the government’s policies and determination as well as the awareness of the community.