Vietnam office closure part of Equinor’s ‘early-stage project portfolio optimization’: exec

Norwegian energy major Equinor’s recent decision to not proceed with offshore wind business development activities in Vietnam is driven by its “early-stage project portfolio optimization,” says an executive.

“The industry is facing significant headwinds, and we must make prioritizations to make sure we are competitive through the downturn,” Jacques Etienne Michel, country managing director of Equinor Vietnam, told The Investor in an emailed interview.

Magnus Frantzen Eidsvold, an Equinor spokesperson told Reuters last week that the company had decided to discontinue its business development in Vietnam and to close the Hanoi office.

The decision was made more than two years after Equinor opened a representative office in Vietnam’s capital and marked the first time the Norwegian state-owned energy firm closed an international office focused on offshore wind development.

The country director elaborated that the prioritization of Equinor’s early-stage project portfolio investments is aimed at “maintaining a strong and balanced portfolio and ensure we can leverage our full technical and financial capabilities.”

He did not comment on the possibility of the Vietnamese government reaching the goal of 6 GW of offshore wind power by 2030. “We don’t have any considerations to make around offshore wind power feasibility in Vietnam.”

The executive stressed that Equinor has enjoyed a long and strong relationship with Vietnam through the years.

The company “still sees Vietnam as an interesting and important market in many regards, for example as a possible destination for oil and gas products, or as part of our supply chain for oil and gas, renewables and low carbon solutions projects around the world,” said Jacques Etienne Michel.

Vietnam currently has no operational offshore wind power projects, although several foreign and domestic groups have shown interest in tapping this huge potential in that country that has more a coastline of 3,260 kilometers in length.

The Ministry of Industry and Trade is drafting a pilot scheme that allows the participation of only state-owned Vietnamese enterprises like Petrovietnam and Vietnam Electricity in offshore wind power development.

Considering that the regulatory framework to support offshore wind development under the National Power Development Plan VIII is still underdeveloped, as well as the six-eight-year project development lead time, the Global Wind Energy Council (GWEC) said in a recent report that no real offshore wind development will take place until route-to-market policies and potentially new law(s) are in place.