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Home / Economy / Industry
Vietnam okays US$5B LNG-to-power project in balancing trade with US
Linh Pham 13:53, 2019/10/04
AES Corporation will develop Son My 2 complex in Vietnam`s central province of Binh Thuan under the build-operate-transfer (BOT) form.
Vietnam’s Prime Minister Nguyen Xuan Phuc has agreed in principle to US-based AES Corporation's plan to invest in a liquefied natural gas (LNG)-fueled power complex costing more than US$5 billion as part of efforts to balance the bilateral trade, local media reported. 
 
Vietnamese Minister Tran Tuan Anh of Industry and Trade hands over license to AES Corporation. Photo: MOIT
Vietnamese Minister Tran Tuan Anh of Industry and Trade hands over in-principle approval to AES Corporation. Photo: MOIT

The Vietnamese Ministry of Industry and Trade (MOIT) informed the move after a visit to Washington by Minister Tran Tuan Anh wrapped up on October 2. 

Once put into operation, the Son My 2 project in the central province of Binh Thuan is estimated to consume an amount of LNG worth US$2 billion a year to be imported from the US, the Voice of Vietnam (VOV) reported.

AES Corporation will develop Son My 2 complex under the build-operate-transfer (BOT) form. It will be the first LNG-to-power plant in Vietnam.

Virginia-based AES is running 1,200-MW Coal-fired Mong Duong 2 Power Plant in Vietnam’s northern province of Quang Ninh in partnership with South Korea’s Posco Energy and China Investment Corporation.

Energy cooperation ahead 
 
Vietnam's Ministry of Industry and Trade and the US Department of State sign an MOU on energy. Photo: MOIT
Vietnam's Ministry of Industry and Trade and the US Department of State sign an MOU on energy. Photo: MOIT

During the visit from September 28 to October 2, the MOIT and the US Department of State signed a memorandum of understanding (MOU) on comprehensive energy cooperation which sets up mechanism for future cooperation for sustainable energy development in Vietnam, facilitating specific partnership of the two countries’ companies.

The MOU opens an era for comprehensive cooperation in power sector regardless of LNG, oil and gas, coal, and renewables. 

Speaking at the signing ceremony in Washington, Minister Tran Tuan Anh said the move aims to set up common goals and solutions for the mutual interests between the two countries, mostly US firms in the context that Vietnam’s power demand growth hits 10-11% annually. 

Vietnam considers the US one of its leading trade partners for not only growing two-way trade but also advanced and environment-friendly technologies in the course that Vietnam will increase the import of LNG in the future, the minister noted. 

Francis R. Fannon, Assistant Secretary for the Bureau of Energy Resources (ENR) at the US Department of State, said the MOU results in framework for the two countries’ mutual interests in energy security, delivering a message of calling for US firms’ investment in Vietnam and therefore helping the country pursues its own energy strategies. 

Allowing AES to participate in Son My 2 project shows Vietnam’s efforts to maintain long-term cooperation in energy and balanced trade with the US, local media quoted the MOIT. 
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