SK proposes $2 bln LNG power project in central Vietnam province Thanh Hoa

SK Innovation Co., Ltd. has proposed the Thanh Hoa provincial People’s Committee allow the South Korean giant to invest in an LNG-to-power project at the Nghi Son Economic Zone.

Company representatives last Saturday met with provincial authorities to discuss the proposal.

The Nghi Son LNG-fueled power project received in-principle approval in March 2024. It is classified as a nationally significant, prioritized power source and slated for commissioning between 2025 and 2030.

According to SK Innovation’s proposal, the plant will have a capacity of 1,500 MW and an investment of over VND51,500 billion ($1.95 billion).

It is expected to contribute nearly VND80,000 billion ($3.03 billion) to the state budget over its lifetime. Construction is set to begin in January 2027 and commercial operation scheduled for Q4/2030.

Unlike an earlier plan to develop the Nghi Son as a standalone project, SK Innovation now proposes integrating it with the Quynh Lap LNG power project in the neighboring province of Nghe An.

Such integration will lead to the establishment of the Quynh Lap-Nghi Son LNG power cluster to share infrastructure. That would allow joint use of an LNG terminal, wharf, and breakwater, potentially reducing investment costs by around $700 million.

The company also highlighted optimized technical design, including streamlined LNG pipeline and equipment layouts, which would shorten gas transport routes, improve efficiency, and ensure safe operation.

SK Innovation affirmed that the project aligns with the Adjusted National Power Development Plan VIII and remains feasible for commercial operation by 2030.

In response, Vice Chairman of Thanh Hoa, Mai Xuan Liem, said he welcomed the proposal and confirmed provincial support.

Thanh Hoa will establish a dedicated task force led by the Nghi Son Economic Zone and Industrial Parks Management Board to work with the investor and relevant agencies to resolve obstacles and accelerate project preparations.

The province will also coordinate with Nghe An province authorities to ensure consistency in planning and legal frameworks.

Liem asked the investor to promptly finalize detailed plans and provide complete documentation for timely appraisal and approval.

Earlier, SK Innovation submitted a draft Joint Development Agreement (JDA) to the Nghe An People’s Committee.

The company emphasized that to achieve commercial operation of the Nghi Son-Quynh Lap LNG power project by 2030, proactive and effective cooperation between both sides is crucial, given the limited timeline.

The proposed JDA seeks to establish a cooperation framework for developing a specialized energy-industrial cluster and the Nghi Son-Quynh Lap LNG power project, expected to contribute to sustainable economic growth and regional energy security.

Under the plan, SK and Nghe An authorities would jointly develop the Nghi Son-Quynh Lap LNG power project, including a 1.5 GW LNG power plant and an LNG storage facility in Quynh Lap.

The LNG storage facility would serve both the Quynh Lap power plant and another 1.5 GW plant to be built in Nghi Son.

Currently, Nghe An’s Department of Finance has been tasked with leading the review of SK Innovation’s proposal in coordination with relevant agencies.

SK Group is South Korea’s second-largest conglomerate, with about 200 subsidiaries. Its investments exceeded $3.5 billion in Vietnam. The group's core sectors include clean energy (LNG, hydrogen), pharmaceuticals and healthcare, logistics, and information technology.

SK Group is exploring several LNG-fueled power projects in Vietnam, including three proposed to be included in the country's green growth project portfolio, said chairman Tae-Won Chey at a meeting with Deputy Prime Minister Nguyen Chi Dung in late May.

The conglomerate is eyeing to develop an LNG-fired power plant in Ninh Thuan province, home to Vietnam's future nuclear power plants, following its similar proposals in Nghe An and Thanh Hoa, all in central Vietnam.