Saturday, November 03, 2007

Vietnam to have first wholly foreign-owned oil refinery

The Vietnamese government has approved a plan that will allow the country’s first wholly foreign-owned refinery to be built in central Phu Yen province, according to local newspaper Vietnam Investment Review on Monday.The proposed 1.7-billion U.S. dollar Vung Ro project, to be developed by the UK’s Techno Star Management in partnership with Russia’s Telloil, is scheduled to supply the domestic market with four million tons of petroleum products each year.

“The in-principle prime ministerial approval has allowed us to issue an investment certificate. I expect the certificate handover ceremony will be held next month, so investors can start building the refinery early next year,” said an official from the Phu Yen Planning and Investment Department.

If construction proceeds on schedule, the Vung Ro oil refinery should become operational in 2012 when Vietnam’s annual demand for petroleum products are estimated to surge to 20 million tons from 12.5 million tons in 2006.

To meet rising domestic demand, the state-run Vietnam National Oil and Gas Group (PetroVietnam) is working on three oil refineries - two in central Thanh Hoa and Quang Ngai provinces, and one in southern Ba Ria Vung Tau province with a combined production output of some 20 million tons per annum.

U.S. company Semtech in partnership with local firm Vien Dong Trading and Investment Company are expected to invest 360 million dollars in developing an oil refinery with annual capacity of 2 million tons in southern Can Tho city.

Vietnam imported 9.2 million tons of petroleum products worth 5.1 billion dollars in the first nine months of this year, up 8.0 percent and 9.4 percent over the same period last year, respectively, according to the country’s General Statistics Office.

Meanwhile, it exported over 11.2 million tons of crude oil totaling nearly 5.8 billion dollars, posting respective year-on-year declines of 10.4 percent and 11.3 percent.