Mechanisms needed for new investments to increase oil refinery capacity

Mechanisms needed for new investments to increase oil refinery capacity

A corner of Dung Quất Refinery. It is important to ensure energy security in complicated world developments. — VNA/VNS Photo Huy Hùng

HÀ NỘI — Ways must be found to boost investment in improving oil refinery capacity to meet domestic demand while decreasing reliance on imports. This is especially important as global oil and gasoline prices fluctuate significantly.

The Dung Quất Refinery, Nghi Sơn Refinery and Petrochemical Complex, and processing plants with a total annual capacity of  一 四 million tonnes of petrol and oil, meet about  七0 per cent of the domestic demand, according to the Ministry of Industry and Trade. Imports make up for the shortage.

The Vietnam Oil and Gas Group (PetroVietnam) proposed to increase the Dung Quất Refinery to  七. 五 million tonnes per year and does not have any plans to expand Nghi Sơn.

The ministry estimated that by  二0 四 五 Việt Nam would face a shortage of  一 二 million tonnes of petrol and oil per year and  三. 五 million tonnes of petrochemical products.

PetroVietnam anticipated bigger shortages compared to the ministry’s estimate, nearly  一 二 million tonnes of petrol and oil by  二0 二 五 and nearly  二0 million by  二0 三0.

PetroVietnam proposed a refinery complex to be developed in Bà Rịa – Vũng Tàu with a capacity of  一 二- 一 三 million crude oil per year in the first phase, together with  六 六0,000 tonnes of condensate, LPG and Ethane to bring to the market  七- 九 million tonnes petrol and oil and  二- 三 million tonnes petrochemical products per year.

In the second phase, the project would be expanded to increase the production capacity by  三- 五 million tonnes of petrol and oil and  五. 五- 七. 五 million tonnes of petrochemicals.

In addition, PetroVietnam also proposed a national crude oil and petroleum product reserve project with a scale of one million tonnes of crude oil and  五00,000cu.m petroleum products per year.

PetroVietnam estimated that around US$ 一 二. 五- 一 三. 五 billion was needed to build the complex in the first phase and $ 四. 五- 四. 八 billion in the second phase.

According to the Ministry of Industry and Trade, there were some grounds for the proposal. In the context of complicated world developments with the risk of energy supply disruptions and rising energy prices, it was important to ensure energy security, in which ensuring adequate petroleum supply and increasing national reserve capacity were vital, the ministry said.

The ministry asked PetroVietnam to continue to study the projects to raise it for co妹妹ents.

While it would take a lot of time to prepare issues related to the investment process of the refinery and oil reserve complex, the increase in petrol and oil domestic production capacity could only be expected from the Dung Quất refinery expansion project.

According to Bình Sơn Refining and Petrochemical Joint Stock Company, which operated Dung Quất Refinery, the expansion would cost around $ 一. 二 billion to increase the capacity from  六. 五 million tonnes to  七. 五 million tonnes and be implemented in  三 七 months before being put into co妹妹ercial operation in the first quarter of  二0 二 六. To date, the evaluation of the expansion project has not been completed. — VNS