American energy corporation AES officially received in-principle approval for its 2.25-gigawatt Son My 2 combined cycle gas turbine power plant in the south-central province of Binh Thuan on Sunday, with an investment of $1.8 billion.
Minister of Industry and Trade Nguyen Hong Dien granted the approval document to the firm at a conference on the north-central and coastal central region's socioeconomic development until 2030, with a vision to 2045.
The factory’s electricity sales contract with the Vietnamese government has a duration of 20 years.
"The investment policy decision is a significant milestone enabling AES to move ahead with the development of the Son My 2 power plant. The approval recognizes the importance of the project in ensuring energy security, promoting international investment and the socio-economic development of Vietnam," Joseph Uddo, president of AES Vietnam, said at the conference.
The built-operate-transfer (BOT) project’s development timeline is from 2023 to 2028. The plant, located in Son My commune, Ham Tan district, features three 750MW turbines.
The $1.8 billion Son My 2 LNG-to-power plant and $1.4 billion Son My LNG terminal are AES’s commitment to Vietnam’s economic growth and energy transition through the development of gas and renewable infrastructure, while helping Vietnam meet its energy transition goals and increasing demand for sustainable and affordable electricity.
In October 2020, AES received a Letter of Interest from the U.S.’s Eximbank and International Development Finance Corporation to support the two with a loan amount of $3.2 billion.
The joint venture between AES and Vietnam's PV Gas received an investment registration certificate for their LNG terminal project in Binh Thuan in May 2022.
The Son My LNG terminal can supply imported LNG for gas-fired power plants in Vietnam with the total capacity of 4,500 MW, beyond the 2,250 MW capacity of Son My 2 CCGT power plant, according to AES.
At the event on Sunday, two other energy projects received in-principle approval. They are the BT2 wind farm-phase 2 worth $54.6 million invested by local firm BT3 Windfarm JSC in Quang Binh province and the Khanh Hoa waste-to-power plant worth $138.6 million invested by local multi-sector business Amaccao Group in Khanh Hoa province.