return icon Vietnamnet.vn

Developers expect smoother LNG policy planning

In Vietnam, about 20 LNG-fired power projects are in the pipeline. Some of these programmes, however, have yet to identify a fuel source.

The government has asked the Ministry of Industry and Trade to clarify the planning data and feasibility of liquefied natural gas power development towards 2030, which has set a target of almost 24,000MW, accounting for 16.4 per cent of the total power source in the nation’s draft master power plan.

The input price of imported liquefied natural gas (LNG) fluctuates between 15-20 cents/kW while the saleable electricity price is currently 6-7 cents/kW only. This will be an obstacle in the future because Electricity of Vietnam (EVN) will have to buy high and sell low.

Despite the mandatory use of the standard form wholesale market power purchase agreement (PPA), complete with untenable fuel cost pass-through clauses being imposed on would-be LNG project sponsors, the market will never accept the proposition.

Prime Minister Pham Minh Chinh questioned why the latest draft of the Power Development Plan VIII (PDP8) seeks to effectively block any new solar power projects until 2030, since “solar power costs are getting cheaper and cheaper, and energy storage battery technology is becoming more advanced at more acceptable pricing”.

The LNG gas power project is scheduled to start construction in the second quarter of 2022

The LNG gas power project is scheduled to start construction in the second quarter of 2022

The government has asked the Ministry of Industry and Trade to clarify the planning data and feasibility of liquefied natural gas power development towards 2030, which has set a target of almost 24,000MW, accounting for 16.4 per cent of the total power source in the nation’s draft master power plan.

According to calculations by the Ministry of Industry and Trade, the import demand for LNG in PDP8 is about 14-18 billion cu.m in 2030 and about 13-16 billion cu.m in 2045. This number is higher than the specific target in the Politburo’s Resolution No.55-NQ/TW released in February 2020 on the orientation of the National Energy Development Strategy of Vietnam to 2030. On the other hand, the input price of imported LNG is fluctuating due to events such as the Ukraine conflict.

A 3.2GW LNG-to-power plant in the Mekong Delta province of Bac Lieu, proposed to be built by Delta Offshore Energy (DOE), is much anticipated. Pham Thanh Hien, deputy director of Bac Lieu Department of Planning and Investment, said, “This would be a major event for Bac Lieu, but the plant has not been able to start construction yet. Currently, the project has not made any progress and is still waiting for consideration and decision.”

Hien explained that investors are still negotiating a PPA with EVN. The project is facing a number of obstacles due to the harsh global restrictions of the last two years.

According to the plans of clean energy developer DOE, the first phase of the project with a capacity of 800MW is expected to start operation in 2024 and construction of the entire project is expected to be completed by the end of 2027. The complex of LNG port and warehouse will be located in the coastal area of Bac Lieu, 35km from the power plant.

Companies including Korean Gas Corporation (KOGAS) are also interested in LNG power generation projects. KOGAS, South Power, and Hanwha Energy are participating in the Hai Lang project phase 1 in the central province of Quang Tri, which was expected to start commercial exploitation in the 2026-2027 period.

However, progress that was approved in PDP7 has now been converted to the draft PDP8, which states that it will be carried out after 2040. Therefore, investors, as well as provincial authorities, are facing quite serious problems.

Previously, at the Vietnam Business Forum held in February, Kim Han-Yong, chairman of the Korea Chamber of Commerce in Vietnam, said that if some PDP8 plans are rolled back beyond 2030, such as it seems with the Hai Lang venture, project development may become practically impossible.

“For example, it will be difficult to coordinate with finance, construction, and equipment companies that are intending to participate in the Hai Lang project. We hope that the Vietnamese government will pay attention and create conditions for projects like these to be implemented as originally planned,” he added.

In Vietnam, about 20 LNG-fired power projects are in the pipeline. Some of these programmes, however, have yet to identify a fuel source.

PetroVietnam Gas claims to have completed eight master sale and purchase agreements last year with LNG providers from the Americas, Europe, Australia, the Middle East, and Asia-Pacific, and that it is still negotiating, unifying, and signing deals with other LNG suppliers worldwide.

Source: VIR

MORE NEWS

Credit package for social housing not as productive as hoped

Few have benefited from the VND15 trillion credit package for social housing as there is a limited supply of low-cost homes.

VIETNAM BUSINESS NEWS AUGUST 17

More effective tax collection of e-commerce necessary

VIETNAM NEWS HEADLINES AUGUST 17

Cultural industry to contribute 10% of Hanoi’s GRDP by 2045

Authority warns of scam South Korea labour export programmes

The Department of Overseas Labour under the Ministry of Labour, Invalids and Social Affairs have warned about scams targeting people who want to work in technical occupations in South Korea.

Textile firms call for favourable policies amid pessimistic prospects

With a pessimistic outlook for the second half of 2022, textile firms are calling for favourable governmental policies to turn their situation around.

Enterprises ignoring waste management to face penalty

Enterprises that are required to manage their waste and have yet to fulfill their payment obligations will be inspected, with a possible fine of up to VND2 billion for violations.

Favorable conditions pledged for Qatar’s funds, enterprises

Competent Vietnamese agencies are willing to create favorable conditions for Qatar’s investment funds and enterprises to seek investment opportunities in the country.

Woman posing for Tiktok video at Phu Quoc airport banned from flying for six months

The head of the Civil Aviation Authority of Vietnam Dinh Viet Thang has decided to issue a flight ban on a woman posing for a TikTok video at the Phu Quoc Airport tarmac for six months.

“1,000 public employees quitting jobs each month is inaccurate data”: HCM City

The Ho Chi Minh City Department of Home Affairs says the information that 6,177 public employees quit their jobs in the first half of 2022 is incorrect. These are actually statistics from January 1, 2020 to June 30, 2022.

Gov't sets up six working groups to inspect disbursement of public investment capital

Prime Minister Pham Minh Chinh has tasked six working groups to inspect disbursement of public investment capital in 41 ministries, state agencies and 18 localities where disbursement is below the national average rate of 34.47 percent as of July 31.

Vietnam to mobilise $360 billion for sustainable development targets

Vietnam needs to mobilise $360 billion for implementing its green and sustainable development targets by 2030.

Vietnam to make Apple Watch, MacBook for first time

Apple is in talks to make Apple Watches and MacBooks in Vietnam for the first time as the US tech giant looks to diversify production away from China, Nikkei Asia reported.

Japanese firm buys 35.1% stake at Vietnam’s power company

JERA Inc., a power generation company of Japan, has signed a deal to buy a 35.1% stake at Vietnam’s Gia Lai Electricity JSC (GEC) to tap the Southeast Asian nation's growing demand for electricity and further its own decarbonisation efforts.

Goalkeeper Dang Van Lam officially signs contract with Binh Dinh

Goalkeeper Dang Van Lam has signed a three-year contract with Binh Dinh FC and is expected to play his first match for his new team in the V.League 1 this weekend.

Vietnam faces shortage of Protamine sulfate

The Drug Administration of Vietnam (DAV) has sent a letter to provincial and municipal departments of health, hospitals and drug importers, asking them to supply information on stocks of Protamine sulfate.
back_to_top