PTT plans $28-bn oil refinery, petrochem plants in Vietnam

The refinery will have a capacity of 660,000 barrels per day.
President and chief executive officer Pailin Chuchottaworn yesterday said the Vietnamese government had appointed PTT Energy Solutions, which is a subsidiary of PTT formed to conduct feasibility studies for petrochemical projects in Thailand and overseas, to study construction of a large-scale oil refinery in the country.
“The study shows that Binh Dinh province, which is in the central region of Vietnam, has a strong capability for the construction of an oil refinery and turnkey industrial projects.
The refinery will be able to produce 660,000 barrels per day, which is higher than any refinery in Thailand. It will include the construction of petrochemical facilities, comprising aromatic and olefin plants with an annual production capacity of 3.7 million tonnes and 6.5 million tonnes, respectively. The total investment will be $28.7 billion, he said.
He said the Binh Dinh area had strong potential for the construction of facilities that would also serve the upcoming Asean Economic Community.
“We have already reported our pre-feasibility study for an oil refinery to the Binh Dinh central provincial government and are waiting for their approval. If successful, we will seek a joint-venture partner for this mega-project,” Pailin saud.
Construction could commence in 2016 and the plant is expected to start operating in 2019, pending approval by the Vietnamese government.
There is currently only one oil refinery in Vietnam, with a capacity of just 140,000 barrels per day, which is insufficient to serve high demand in the country, which has a population of nearly 90 million.
Thailand, which has a lower population, has an oil-refining capacity of 1 |million barrels per day.
Meanwhile, the Viet Nam Chemical Group (Vinachem) plans to sell off the remainder of its shares in the Long Son petrochemical complex next month, according to Viet Nam News.
Vinachem said it would invest returns from the sale into its core business of non-oil and fertiliser products. The group currently owns 11 per cent of the complex’s shares.
A representative of the National Oil and Gas Group (Petro-Vietnam), which owns 18 per cent of the capital at the complex, said that after Vinachem withdrew its capital from the project, Petro-Vietnam would have the first option to buy the group’s shares.
However, a Thai investor in the complex project is also ready to buy Vinachem’s shares.
PetroVietnam, Vinachem, Vina SCG Chemicals Company, and Thailand Plastic and Chemicals signed a joint-venture contract in March 2008 to develop the Long Son petrochemical complex. The authorities of the southern province of Ba Ria-Vung Tau granted an investment certificate |to the project that July.
The 400-hectare complex will be built in the Long Son Industrial Zone near Long Son oil refinery with an investment of $4 billion. The capacity will be 3 million tonnes per year.
The complex is one of several projects planned for the Vietnamese oil and gas industry. The others include the Dung Quat, Nghi Son and Long Son refineries.
Long Son is expected to produce an annual supply of 1.45 million tonnes of polyethylene (PE) and polypropylene (PP), 730,000 tonnes of chemical raw material for the production of polyvinyl chloride and 840,000 tonnes of other kinds of chemical products for |the petrochemical and chemical industries.
The complex is expected to meet 65 per cent of demand for PE and PP on the domestic market and to stabilise the raw-material supply for the petrochemical industry.