11:29 | 16/05/2016 Industry
The upcoming operation of Idemitsu Q8 Petroleum LLC in Vietnam’s petroleum market is expected to increase the competitiveness of the local oil and gas product market and bring more benefits to local consumers, experts said.
Construction site of Nghi Son oil refinery project (Source: Internet)
Idemitsu Q8 is a joint venture between Japan’s Idemitsu Kosan Co. Ltd and Kuwait Petroleum International Ltd. (KPI). With its establishment , the venture intends to specialise in importing, wholesaling and retailing fuels in Vietnam.
According to the Ministry of Industry and Trade, the establishment of Idemitsu Q8 marks the first time foreign companies have got involved in Vietnam’s fuel distribution market where there are 24 domestic trading companies operating.
This is within the Government’s commitment with investors who are investing in the Nghi Son oil refinery project in the north-central province of Thanh Hoa.
Phan The Rue, Chairman of the Vietnam Petroleum Association said when Nghi Son oil refinery commissions in 2017, Idemitsu Q8 will begin selling oil and petrol and this will be a basis for Vietnam to open its petroleum market earlier than the set plan.
The State needs to outline specific plans and strategies for opening the market, Rue noted, adding that measures should be devised to solve difficulties facing petroleum enterprises.
When joining the World Trade Organisation, Vietnam retained the right to trade, distribute, export and import petroleum products and foreigners could not join the domestic distribution system.
However, Vietnam has made some exceptions and has opened the distribution market to investors at petrochemical projects. When licensing the Nghi Son oil refinery project, the Government allowed investors to distribute the products they make. Therefore, Idemitsu Q8 was established in preparation for Nghi Son’s distribution of fuels from 2017.
Nghi Son oil refinery, which is constructing in an area of some 400 hectares in the Nghi Son Economic Zone, is expected to process 8.4 million tonnes of crude oil a year in the initial phase and will eventually increase to 10 million tonnes per annum.
Shareholders of Nghi Son oil refinery include Vietnam National Oil and Gas Group (PVN) and Idemitsu Q8./.