Saturday, November 03, 2007

Foreign firms to develop oil refinery in Phu Yen Vietnam

VietNamNet Bridge – The UK's Technostar Management Ltd. and Russia's Telloil will build an oil refinery at a total cost of US$1.7bil in the central province of Phu Yen.

Vice Prime Minister Hoang Trung Hai has given approval to the province to issue an investment certificate to the two investors to establish a new company for the project.

The Vung Ro project, with 51% ownership by the UK firm, will become the first wholly foreign-owned oil refinery to be built in the country.

Vung Ro will be the country's fourth oil refinery and is expected to supply the domestic market with four million tons of petroleum products annually.

The department plans to deliver the investment certificate to investors by next month in order for construction to begin next year.

Under the agreement, Hai requested that the Vung Ro developers complete an environmental assessment report before commencing construction and to utilize modern technology to build the refinery.

The two firms will develop the project on a 200-hectare plot near Vung Ro Seaport in Tuy Hoa District due to its optimum access to traffic.

Technostar Management initiated plans for the oil refinery more than two years ago and plans to invest some US$500mil. The refinery's capacity will total three million tons of petroleum annually using crude oil from PetroVietnam. Investors have also found a stable supply of crude oil from the Middle East and will increase investment capital and product output.

The country's three other oil refineries are located in Quang Ngai, Thanh Hoa and Ba Ria-Vung Tau provinces. When all four oil refineries are fully functional, their combined production output will total 20mil tons of petroleum per year through 2012.

Also in Phu Yen Province, Singapore's SP Chemicals has plans to develop a petrochemical industrial park project. The Hoa Tam Petrochemical Industrial Park will begin accepting projects in 2009 and is estimated to attract US$11bil, with US$5bil coming directly from SP Chemicals and the remainder from other investment partners.

The company received approval from the prime minister in early August to begin building infrastructure for the industrial park and the petrochemical complex in the central coast province.

Under the company's plan, US$1.5bil will be invested in the first phase of the project scheduled from 2009-2014 to develop Hoa Tam into a petrochemical industrial zone with a port capable of holding ships up to 250,000 DWT.

During the first phase, SP will also develop a naphtha cracking petrochemical complex project using local and imported materials. The complex will have the capacity of 800,000 tons of ethylene a year.