Vietnam’s first LNG-fueled power plants inaugurated

Nhon Trach 3 and 4, Vietnam’s first LNG-fired power plants, were inaugurated on Sunday and are scheduled for commercial operations in early 2026.

Located in the southern province of Dong Nai, the two plants have combined investment capital of about $1.4 billion and total capacity of 1,624 MW.

Petrovietnam's subsidiary PV Power is the investor, while a consortium of Lilama and Samsung C&T is the EPC contractor.

Once operating at full capacity, they are designed to generate more than 9 billion kWh of electricity annually, providing a large-scale baseload power source for the national grid, particularly in southern Vietnam.

The plants are equipped with cutting-edge technology, featuring U.S. firm GE’s 9HA.02 gas turbines - currently among the most advanced in the world in terms of technology, capacity, and efficiency. Thanks to this technology, the facilities are expected to achieve an efficiency of 62-64%, among the highest levels today.

The 9HA.02 technology meets stringent emissions standards and allows flexible fuel conversion, from LNG to co-firing up to 50% hydrogen, with the potential to transition to 100% hydrogen in the future.

According to Petrovietnam, the project is a model for the LNG power plants that the corporation plans to develop in the future, laying the foundation for an era of modern gas-fired power in Vietnam.

This is the first power project in Vietnam to successfully secure international loans (over $1 billion) without a government guarantee. The implementation process faced numerous challenges due to the lack of a specific mechanism for LNG power generation, obstacles in negotiating the power purchase agreement (PPA), and environmental commitments.

"Committing to a minimum output guarantee for gas-fired power projects is a major challenge because LNG prices depend on the international market," said Nguyen Duy Giang, deputy general director of PV Power.

Speaking at the inauguration ceremony, Prime Minister Pham Minh Chinh described Nhon Trach 3 and 4 as "a particularly important piece” in strengthening national energy security and supporting Vietnam’s rapid and sustainable development in the new period.

Drawing on international experience, the Prime Minister noted that countries achieving fast and sustainable growth all possess strong, stable, and modern energy infrastructure. “The power sector must move one step ahead, paving the way for industrialization and enhancing the competitiveness of both the economy and the nation,” he said.

Vietnam’s peak electricity demand currently stands at about 54,500 MW and is increasing by an estimated 6,500-8,200 MW each year. This underscores the urgent need for reliable power supplies, especially as the country accelerates strategic breakthroughs in high technology, semiconductor manufacturing, large-scale national data centers, digital transformation, green transition, and major infrastructure projects such as high-speed and urban rail systems.

The cabinet leader emphasized that with annual output exceeding 9 billion kWh, the commissioning of Vietnam’s first LNG power complex has laid a solid foundation for the development of a gas-fired power market, providing a proactive and stable electricity source.

He highlighted the project’s standout features, including its low investment cost, the largest scale, the most advanced technology, the highest capacity, the shortest EPC contractor selection period (11 months), and the most competitive commercial electricity price.

Under the adjusted Power Development Plan VIII, Vietnam aims to add nearly 37,500 MW of new gas-fired power capacity, with LNG accounting for around 60%. However, many projects are facing challenges in securing output offtake agreements to ensure stable cash flows, as well as in planning long-term fuel supply volumes and prices.

To achieve this goal, the Prime Minister requested ministries and agencies to review and remove procedural bottlenecks, particularly by finalizing policies for LNG-fired power plant operations and the LNG power supply chain.

He also urged enterprises to prepare plans and engage early in negotiations with partners on spot LNG imports to reduce price risks, lower input costs, and enhance project efficiency.