Vietnam's Dung Quat refinery to shut for repairs

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Nov. 17 -- Petrovietnam, apparently at the urging of state officials, reported it will shut down the 148,000 b/d Dung Quat refinery for 10-14 days for maintenance in December.

The facility, which began operating in February, has experienced several stoppages in the past year due to technical problems. In mid-August, it was shut down for 6 weeks due to a technical fault in a cracking unit.

"There was a problem at the RFCC unit and repairs should take about 20 days, which means the plant will resume operation by Sept. 9 or 10," said a Petrovietnam official, who declined to be identified (OGJ, Sept. 4, 2009).

At the time, officials said the plant would go back online at the end of September, and would begin running at full capacity by Oct. 20.

On Oct. 30, reports said the refinery had operated at full capacity in the first full week after the shutdown, and that Vietnam's crude exports were expected to fall after the unit’s successful restart.

However, reports in local media now say the unit’s crude oil floating storage and offloading vessel has broken down.

As a result, the Phap luat Thanh pho Ho Chi Minh newspaper Nov. 13 said the state appraisal council, which reported the breakdown to Prime Minister Nguyen Tan Dung, asked Petrovietnam to take “drastic measures” to deal with the issue.

The council’s request came just days after Vietnam’s Minister of Industry and Trade Vu Huy Hoang said general contractor Technip would hand the Dung Quat facility over to Petrovietnam in January at the latest.

The refinery was due to become fully operational by yearend, or 2 months behind schedule, Hoang said on Nov. 10.

On Nov. 7, Petrovietnam’s subsidiary Binh Son Petrochemical & Refinery Co. signed a $4.8 million, 1-year contract with the Marine Oil & Gas Maintenance Co., Oil & Gas Technology Co., and Malaysia’s OSS for maintenance of the refinery’s single-point mooring structure.

Since starting up in February, the Dung Quat refinery has bought 1.2 million tons of oil pumped from the the Bach Ho (White Tiger) oil field, which lies off the southern coastal province of Ba Ria-Vung Tau. During that time, the $3.054 billion facility has produced 800,000 tons of products.

The Vietnamese government, aiming to reduce the country’s trade deficit, has been hoping that production at Dung Quat would help to reduce, or even halt the import of petroleum products during the remainder of 2009. The country’s trade deficit is forecast to run at $11.5-12.5 billion this year, compared with $17.516 billion in 2008.

Contact Eric Watkins at hippalus@yahoo.com.

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