Delta Offshore Energy strives to continue $4 bln LNG-to-power project in Vietnam: exec

The United States-based Delta Offshore Energy (DOE) is committed to overcoming issues and continuing its $4-billion LNG-to-power project in Vietnam’s Mekong Delta province of Bac Lieu.

A DOE delegation, led by its co-founder Ian Nguyen, made the commitment at a Tuesday meeting with Bac Lieu authorities, referring to Bac Lieu Chairman Pham Van Thieu’s questions regarding if DOE would continue the project by itself or by establishing a joint venture.

While stressing the issues facing the 3,200-MW project, the delegation said DOE is striving to complete negotiations for a power purchase agreement (PPA) this year in order to continue the project, towards completion in 2029.

Bac Lieu Chairman Thieu requested DOE to arrange meetings with the government and the Ministry of Industry and Trade to handle the issues. DOE must negotiate power sale prices with state utility Vietnam Electricity (EVN), he added.

In January 2020, Bac Lieu authorities gave an in-principle nod to the project and approved its plan of completion in December 2027.

In May 2023, DOE said it wanted to secure a PPA for the project in the last quarter of 2023.

In May 2024, the Ministry of Industry and Trade approved the base price for LNG-fired power produced by combined cycle gas turbine thermal power plants at VND0-2,590.85 per kWh, equivalent to 10.56 U.S. cents per kWh, for 2024. The ministry clarified that the figure does not include VAT, and that VND2,590.85 is the ceiling price. Based on the figure, EVN and power generation units will negotiate further over power prices, the ministry highlighted.

According to a draft decree and other documents prepared by the ministry regarding PPAs for LNG-fired power plants, LNG-fueled power plants and EVN should negotiate long-term PPAs. In case no agreement is reached, the government will assign EVN the task of calculating details related to the amount purchased in the PPAs, with a focus on ensuring energy security, fairness between different energy sources, minimal impacts on electricity retail prices, and EVN’s financial status.

Also within the draft decree, the Ministry of Industry and Trade proposed a pass-through mechanism that will allow LNG purchase prices to directly impact the retail selling prices of LNG-fueled power, starting August 1.