February 26, 2018 / 9:33 AM / a month ago

UPDATE 1-Vietnam's Nghi Son oil refinery ready for start-up from Feb. 28

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By Mai Nguyen

HANOI, Feb 26 (Reuters) - Vietnam’s second oil refinery, Nghi Son Refinery and Petrochemical, will be ready for start-up from Feb. 28, its parent firm Vietnam Oil and Gas Group, or PetroVietnam ,said on Monday.

The $9 billion plant, co-owned by Kuwait Petroleum Europe BV and Japanese firms Idemitsu Kosan and Mitsui Chemicals , is designed to help Vietnam cope with a shortage of refined oil products.

Vietnam’s first refinery Dung Quat currently supplies 30 percent of the country’s total domestic fuel demand. The 200,000 barrel-per-day (bpd) Nghi Son plant along with Dung Quat will help Vietnam meet 80 percent of its fuel demand.

Operations at Nghi Son, in Thanh Hoa province south of the capital of Hanoi, were previously delay but are now expected to begin producing commercial products such as paraxylene starting in April and, starting in May, A95 gasoline and diesel fuel, PetroVietnam said.

Nghi Son will process Kuwaiti crude oil to produce liquefied petroleum gas, gasoline, diesel, kerosene and jet fuel, mainly for the domestic market.

Kuwait Petroleum International and Idemitsu Kosan each own 35.1 percent, while PetroVietnam holds a 25.1 percent stake and Mitsui Chemicals has 4.7 percent.

Vietnam exports some crude oil but its shipments have been decreasing as production declines from older fields and as some production has become uneconomic amid lower oil prices.

Late last week, Thailand’s Siam Cement and PetroVietnam started construction of a $5.4 billion petrochemical site at Long Son, near the city of Vung Tau, east of Ho Chi Minh City. The site is scheduled to start operations in 2022.

Reporting by Mai Nguyen; Editing by Manolo Serapio Jr. and Christian Schmollinger

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