PVN to seek Japanese funding for US$10-billion petroleum project
PetroVietnam (PVN) and the Japan Bank International Cooperation (JBIC) are discussing financial arrangements for the Block B gas project and 52/97 field development project, announced PVN on its website.
Following the discussion, JBIC will consider providing funding for the Block B and 52/97 projects without a guarantee from the government.
PVN to seek Japanese funding for US$10-billion petroleum project.
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With such large investment, stated PVN, the search for an appropriate financial arrangement has been a major concern for foreign partners taking part in the project.
Following the schedule, the project will award the contract and sign the first engineering, procurement, construction and installation (EPCI) contract in June, while the second EPCI will be inked in July.
Block B gas project includes 2 components. The first component is to develop the Block B gas field worth US$6.8 billion, which will be financed and operated by PVN (42.896%) in partnership with PVEP (26.788%), Mitsui Oil Exploration Co. Ltd. (22.575%) and PTTEP (7.741%).
The Block B field development will include one central technology platform, 46 operations platforms, a housing platform, one condensate vessel and drilling of 750 production wells.
The second component is the US$1.2-billion 431km-long Block B – O Mon gas pipeline, with PVN, PVGas, Mitsui Oil Exploration Co. Ltd. and PTTEP forming a joint collaboration for the pipeline development.
The project will produce and transport gas from the three fields to the power plants located in Kien Giang and O Mon regions. It is estimated that approximately 5.06 billion cubic meters of gas per year will be transported onshore from the total estimated reserves of 3.78 billion cubic feet for a period of 20 years starting in 2020.
The project is expected to assist Vietnam in achieving its objectives under the ‘Strategy for development of Vietnam oil and gas industry until 2025 and orientation to 2035’, stated PVN. It will also contribute to the country’s energy security by supplying gas to power plants and establishing a large gas infrastructure.
An estimated US$19.23 billion will be added to the state budget during the project’s 20-year lifetime, according to the project’s feasibility study. The project will also contribute to government revenue during its construction through a VND400 billion (US$15.78 million) import tax.
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Vietnam news in brief - August 24
Read The Hanoi Times to stay up to date on developments in Vietnam.
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- Vietnam Gov’t committed to facilitating Adani Group’s US$2-billion port project
- Vietnam Railway proposes US$87 million for Hanoi–Dong Dang railway upgrade
- Vietnam’s North-South high-speed railway to be designed for 350km/h
- Vietnamese gov’t urged to address impact of global minimum tax
- Samsung plans drastic investment increase in Vietnam over next three years