It is time to make amendments to the current Law on Petroleum to legally facilitate the development of Vietnam’s oil and gas industry and implement the strategy for sustainable development of the maritime economy until 2030 and with a vision towards 2045.

This view was shared among participants at a seminar on the local oil and gas industry as part of a new vision of the maritime strategy in Hanoi on October 28.

The oil and gas industry is vital to ensuring energy security and building national defence, said Nguyen Van Phuc, former Vice Chairman of the National Assembly’s Economic Committee. The industry, which is an important part of the maritime economy, also stimulates the service sector and support industries, creates jobs for people and contributes to the State and local budgets, he added.

But now the Law on Petroleum is deemed no longer sufficient to allow the industry to develop further in the new context, Phuc noted. Though the law has been amended twice, in 2000 and 2008, it places most focus on the upstream segment, also known as the exploration and production of oil and gas. Meanwhile, no provision is made for the midstream business, which involves the transportation, storage, and marketing of petroleum products; and downstream sector, or the refining of crude oil and processing and purifying of raw natural gas, according to Phuc.

As a result, it is challenging to draw investment in the development of the industry’s value chain through all three major segments.

Echoing Phuc’s view, Deputy Director of the Central Institute for Economic Management (CIEM) Tran Kim Chung said the strategy for sustainable development of the maritime economy can only work if it is provided with an appropriate legal framework alongside an exclusive financial strategy and budgeting for its key industries, like oil and gas.

The industry needs a mid-term and long-term financial and budgeting mechanism rather than in the short run like it is now, Chung added.

When the global oil price was at a high level, the Government should have set aside a reserve fund from revenue of oil and gas exports to re-invest into the industry and cover unexpected future costs when the price sinks, he suggested.

Agreeing with Chung, Dr. Nghiem Vu Khai from Hai Phong’s delegation of National Assembly deputies said the oil and gas sector used to contribute 24 – 25 percent of the State budget between 2006 and 2008; however, the contributions have been largely spent on other purposes rather than returning to boost the industry.

He urged the government and relevant ministries such as the Ministry of Science and Technology and Ministry of Industry and Trade to create a fund to stimulate petroleum technologies as well as maritime economy.

Taking notes of all the proposals, Vice Chairman of the NA’s Economic Committee Nguyen Duc Kien agreed that the changing socio-economic situation requires policymakers to have a new approach to the management of the oil and gas sector and the technology application in the industry.

He unveiled that the Law on Petroleum will be amended, noting that the NA’s committees are discussing with the government a plan on the revision of the law, which will take place between 2019 and 2020.–VNA