Stepping Up LNG Projects in Vietnam: A Call to Action by Prime Minister
Following delays related to the startup of Vietnam’s liquefied natural gas (LNG) projects under development announced at a recently held industry event, the country’s Prime Minister has called for stepping up the ante on starting their commercial operation.
As reported by Vietnam Business Forum Power & Energy Working Group, Lã Hồng Kỳ from Vietnam’s Office of the National Steering Committee on Energy Projects stated that, of the approximately 14 gas-fired power projects currently underway, only the Nhon Trach 3 and 4 plants are expected to start operations in Q2 and Q3 of 2025. The statement was made during a forum held on December 18, 2024.
Additionally, the Block B–O Mon and Hiep Phuoc 1 combined cycle power plants, with a combined capacity of 6,634 megawatts (MW), are considered the only other projects that could become commercially operational before 2030. The remaining projects will only be able to come online by 2030 if power purchase agreements (PPA) and gas sale agreements (GSA) are completed and financing is secured by 2026, the working group noted.
In June, the state-owned PetroVietnam signed multiple agreements with its partners to proceed with the Block B–O Mon project, an integrated development project. Consisting of blocks 48/95 and 52/97 B, the Block B project entails an upstream gas field offshore Southwest Vietnam and a pipeline linking it to O Mon, a gas-fired thermal power plant complex 400 kilometers away.
When the new year rolled in, Vietnam’s Prime Minister Pham Minh Chinh requested – in a government press release dated January 3, 3025 – the Chairman and General Director of PetroVietnam to focus all resources to “urgently” organize the construction of Nhon Trach 3 and Nhon Trach 4 thermal power plants, so they can be completed and put into commercial operation in June 2025.
Prior to this, a $521.5 million facility agreements were signed for Nhon Trach 3-4 on October 1, 2024. As stated by Petrovietnam’s subsidiary, Petrovietnam Power, various other credit agreements were also signed to finance the project before that, including a $200 million SMBC/SACE loan on March 31, 2023, and a VND4,000 billion, or approximately $0.16 billion, VCB loan on September 26, 2023.
According to Hoang Van Quang, Chairman of Petrovietnam Power’s Board of Directors, the consortium of two banks, Citi and ING, is behind the latest loan, which is also supported by South Korea’s KSURE and Swiss SERV. As the first LNG power plant project in Vietnam, the project is considered crucial to the country’s energy transition.
In 2022, a $940 million contract was handed out to a consortium comprising South Korea’s Samsung C&T and Vietnam’s Lilama to build the LNG-fueled power plants.
Furthermore, the PM requested that obstacles in the Blue Whale (Ca Voi Xanh) gas-to-power project be removed to implement it according to plan. The partners in the production sharing contract (PSC) for blocks 117–119 holding the Ca Voi Xanh gas field are ExxonMobil, EMEPVL, and PetroVietnam Exploration Production Corporation (PVEP).
Described as the largest gas field in Vietnam, Ca Voi Xanh was found to hold “a significant quantity of natural gas” by developers in 2011. The resource is said to be large enough to power a city the size of Hanoi for more than 20 years.
The gas from the field is expected to power the Dung Quat Power Complex, comprising three combined cycle gas turbine power plants, each with a capacity of about 750MW. Dung Quat I and Dung Quat III power plants were scheduled to be put into operation in 2023 and 2024–2026, respectively, while Dung Quat II power plant was scheduled to be put into operation in 2024.
Vietnam Electricity (EVN) is the developer of plants I and III, and Sembcorp is in charge of plant II. With a total capacity of 2,250MW, the three power plants are expected to have an annual average electricity output of about 13 billion kWh once in operation.