By OGJ editors
HOUSTON, Feb. 27 -- Vietnam opened its first refinery, a $3 billion project designed to meet a third of Vietnam's fuel demand in 2010.
The 148,000 b/d plant will be operated by state-owned Vietnam Oil & Gas Group (Petrovietnam) after Total SA and Russia's OAO Zarubezhneft pulled out amid complaints that the project's economic efficiency was being sacrificed to political pressures in the country.
Petrovietnam insisted the plant be built at Dung Quat Bay in the central province of Quang Ngai to create jobs in that economically poor and typhoon-prone area hundreds of miles from the country's main industrial hubs and offshore oil fields. The World Bank said in 1997 the project would not help Vietnam's economy and the International Monetary Fund questioned Dung Quat's value.
Construction was by an international consortium led by France's Technip SA. A port was built as part of the project so petroleum products can be shipped by sea. Petrovietnam said the refinery should be at full capacity in August. The company is designing another refinery, in the north, and has tentative plans for a third.
With output of 340,000 b/d in 2007, Vietnam was the third-largest oil producer in Southeast Asia after Indonesia and Malaysia. Its production is expected to increase as international oil companies bring new fields on stream.
Vietnam's demand for oil products has grown 10-13%/year in recent years, and its imports increased by 0.1% in 2008 to 12.9 million tonnes.