Vietnam’s Phu Yen proposes resuming long-stalled refinery project given provisional $5bn Malaysian investment
Wednesday, May 10, 2023, 10:40 GMT+7
The administration of Phu Yen Province in south-central Vietnam has suggested resuming the Vung Ro oil refinery project, which was scrapped in 2018, considering a Malaysian firm’s plan to invest US$5 billion in an oil refinery in the province.
The Ministry of Industry and Trade has asked the Institute of Energy and the Vietnam Petroleum Institute to study Phu Yen’s proposal to add the oil refining and energy industry to the national energy planning and the 8th power master plan.
Phu Yen was allowed to develop the Vung Ro oil refinery, the oil refining sector, metallurgy, and renewable energy.
The province has worked with some large investors who are interested in projects in its precincts, such as steelmaker Hoa Phat Group which wants to develop four industrial parks, Bai Goc port, an iron and steel complex, and trade-service centers.
These four projects require an estimated investment of some VND110 trillion ($4.7 billion).
However, the plan to develop oil refining and energy in Phu Yen is not included in draft energy development plans on which the Ministry of Industry and Trade is consulting relevant agencies.
The ministry said the Vung Ro oil refinery project was no longer appropriate, so it did not propose developing the project in Phu Yen.
The provincial People’s Committee argued that it needs the consensus of the Ministry of Industry and Trade to exploit its potential advantages and attract large investors.
The Vung Ro oil refinery project, whose investor was a consortium of the UK’s Technostar Management Ltd and Russia’s Telloil Group, got the first investment certificate in November 2007 with a price tag of $1.7 billion and a designed capacity of four million metric tons per year.
In April 2011, the investor suggested increasing the investment to $2.5 billion and the annual capacity to eight million metric tons.
It was not commenced until September 2014 when the investment was revised up to $3.2 billion.
Phu Yen had striven to clear the site for the project, handed over 134ha, and been committed to handing over another 400ha.
However, the project was put on hold for months before the investor terminated it.
The Phu Yen Economic Zone Authority revoked the investment certificate for the project in 2018.
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