Investors of Vietnam’s largest refinery focused on securing raw material input

By Minh Van
Fri, September 9, 2022 | 2:48 pm GTM+7

Japan’s Idemitsu Kosan and the three other owners of Vietnam's largest refinery Nghi Son are giving priority to ensuring cash flow for the complex so as to import sufficient crude oil, an Idemitsu executive said Thursday.

The $9-billion refinery in the central province of Thanh Hoa accounts for 35% of domestic supply, and enjoys tax exemption and other incentives. Idemitsu and Kuwait Petroleum International own 35.1% stake each, Mitsui Chemicals owns 4.7%, while state-owned Petrovietnam owns 25.1%.

 Nghi Son Refinery in Thanh Hoa province, central Vietnam. Photo courtesy of Thanh Hoa newspaper.

Nghi Son Refinery in Thanh Hoa province, central Vietnam. Photo courtesy of Thanh Hoa newspaper.

Because of its accumulated losses, the refinery had to reduce output to 80% this January, trigging a fuel shortage in Vietnam.

On the sidelines of an oil price fluctuation workshop in Hanoi Thursday, Idemitsu investment director Hideaki Egashira told local media that his company was seeking to ensure sufficient imported inputs for Nghi Son.

“Early this year, there was a time we didn't have enough money to buy crude oil," he said.

The problem was later partially resolved as the four partners agreed in principle on a business restructuring process and short-term financial supplies, which helped the complex run temporarily.

To stabilize finances for the refinery, Egashira said it was necessary to secure consent from the investors, other stakeholders, financial institutions that fund the project, as well as the Vietnamese government’s support.

“The project investors have different business viewpoints. We are trying our best to solve this problem to ensure cash flow to buy materials for production and stabilize supply,” he said, adding that the four partners are expected to reach a consensus by the end of this year.

According to a recent Petrovietnam report, Vietnam’s two operational oil refineries - Nghi Son and Dung Quat - supplied about 3.9 million cubic meters of oil products in the third quarter, accounting for 72% of the country’s demand. Their supplies are set to increase to 4.4 million cubic meters (80% of domestic demand) in the fourth quarter.

As Vietnam’s largest oil refinery, Nghi Son has to operate steadily to ensure stable supply.

At present, Asian heavyweight Siam Cement Group (SCG) is nearing the completion of its $5.4 billion Long Son Petrochemicals Complex in Ba Ria-Vung Tau province near Ho Chi Minh City. The complex is expected to begin full operations in the first half of 2023. It will be Vietnam’s third operational oil refinery.

Comments (0)
  • Read More
Vietnam banking system's bad debts hit 1.7%

Vietnam banking system's bad debts hit 1.7%

The Vietnamese banking system's bad debt ratio remained safe at 1.7% by the end of July, the central bank says in a report sent to the National Assembly’s Economic Committee.

Banking - Sun, October 2, 2022 | 3:51 pm GTM+7

Vietnam earns $40.8 bln from agriculture, fisheries, forestry exports

Vietnam earns $40.8 bln from agriculture, fisheries, forestry exports

Vietnam earned $40.8 billion from exporting agriculture, forestry and fisheries products in the first nine months of this year, up 15.2% year-on-year.

Economy - Sun, October 2, 2022 | 2:22 pm GTM+7

70% of land for Hanoi's Ring Road 4 project ready by next June

70% of land for Hanoi's Ring Road 4 project ready by next June

Hanoi, Bac Ninh and Hung Yen authorities have committed to handing over 1,341 hectares of land, or 70%, before June 30 next year so the Hanoi Ring Road 4 project can break ground as scheduled.

Infrastructure - Sun, October 2, 2022 | 2:00 pm GTM+7

Formosa thermal power plant explosion kills worker

Formosa thermal power plant explosion kills worker

Three workers were conducting maintenance work on gas pipelines at Formosa’s thermal power plant in Ha Tinh province when an explosion occurred, killing one and severely injuring the other two.

Society - Sun, October 2, 2022 | 11:51 am GTM+7

Rules need to make public bond issuance outpace private placement: experts

Rules need to make public bond issuance outpace private placement: experts

Vietnamese regulators need to fasten and simplify legal steps to encourage public bond issuances as enterprises usually opt for private placements, say experts.

Finance - Sun, October 2, 2022 | 10:36 am GTM+7

VN-Index plunges to 30-month low

VN-Index plunges to 30-month low

Vietnam’s benchmark VN-Index fell almost 12% in September compared with August, making it the exchange's biggest one-month drop in 30 months.

Finance - Sun, October 2, 2022 | 8:47 am GTM+7

Vietnam welcomes 1.87 mln foreigners, South Koreans in the lead

Vietnam welcomes 1.87 mln foreigners, South Koreans in the lead

Vietnam welcomed 1.87 million foreign visitors in the first nine months of the year, up 16.4 times year-on-year, with South Korea and the U.S. leading the pack.

Travel - Sat, October 1, 2022 | 8:26 pm GTM+7

US firm Molex expands Vietnam facility with solar panel installation

US firm Molex expands Vietnam facility with solar panel installation

Molex, a U.S. manufacturer of electronic, electrical and fiber optic connectivity systems, has expanded its manufacturing facility in Hanoi with solar panel installation.

Industries - Sat, October 1, 2022 | 6:46 pm GTM+7

EVN, Trungnam Group hold talks on solutions for solar power usage deadlock

EVN, Trungnam Group hold talks on solutions for solar power usage deadlock

State-owned Vietnam Electricity (EVN) has asked Trungnam Group to put the 172-megawatt capacity portion without a pricing mechanism of its 450 MW solar farm in Ninh Thuan into the competitive power generation market.

Energy - Sat, October 1, 2022 | 3:54 pm GTM+7

Danish firm Spectre opens third Vietnam factory in An Giang

Danish firm Spectre opens third Vietnam factory in An Giang

Spectre, a Danish maker of functional garments for outdoor sports brands, started operating its $17 million factory in An Giang province Friday, the company’s third in Vietnam.

Industries - Sat, October 1, 2022 | 3:06 pm GTM+7

Foreign firm accountant gets death sentence in $9.6 mln corruption case

Foreign firm accountant gets death sentence in $9.6 mln corruption case

A Dong Thap province court on Friday handed a death sentence to Nguyen Trung Thanh, chief accountant of Filipino-invested Pilmico Vietnam, on corruption charges.

Society - Sat, October 1, 2022 | 2:43 pm GTM+7

Vietnam’s nation brand valued at $431 billion

Vietnam’s nation brand valued at $431 billion

Vietnam has seen the third biggest brand value gain over the course of the pandemic in absolute terms, up $184 billion year-on-year to $431 billion in 2022, says London-based Brand Finance.

Economy - Sat, October 1, 2022 | 11:22 am GTM+7

Former deputy health minister gets year off jail term

Former deputy health minister gets year off jail term

An appeals court in Hanoi has reduced the jail term for former deputy minister of health Truong Quoc Cuong to three years, one year less than sentence awarded by the court of first instance in May.

Society - Sat, October 1, 2022 | 11:05 am GTM+7

Fever cools, townhouse, villa segment turns lethargic in major cities

Fever cools, townhouse, villa segment turns lethargic in major cities

Liquidity in the townhouse and villa segment, once feverishly high in both Hanoi and Ho Chi Minh City, has been drying up in recent months.

Real Estate - Sat, October 1, 2022 | 9:50 am GTM+7

AES gets ministerial nod for 2,250 MW LNG power project in Binh Thuan

AES gets ministerial nod for 2,250 MW LNG power project in Binh Thuan

American energy corporation AES has received in-principle approval from the Ministry of Industry and Trade for its VND50,432 billion ($2.11 billion) Son My 2 LNG-to-power project in the south-central province of Binh Thuan.

Energy - Fri, September 30, 2022 | 9:24 pm GTM+7

Coro Energy operates pilot rooftop solar power project in Vietnam

Coro Energy operates pilot rooftop solar power project in Vietnam

Coro Energy has completed commissioning of its Vietnam rooftop solar pilot project, the UK-based energy firm announced Friday.

Energy - Fri, September 30, 2022 | 6:59 pm GTM+7