15:58 | 22/03/2018 Industry
(VEN) - The Long Son Petrochemicals (LSP) complex in Ba Ria-Vung Tau Province officially began construction on February 24 after a 10-year delay. The US$5.4 billion project by the Long Son Petrochemicals Co., Ltd, a joint venture between Thailand’s SCG Group and the Vietnam National Oil and Gas Group (PetroVietnam), will cover almost 464 hectares of land and 194ha of water surface. LSP is the third facility of its kind in Vietnam, after Dung Quat and Nghi Son oil refineries.
|Prime Minister Nguyen Xuan Phuc (left row, first from right) and leaders of ministries, sectors and the SCG Group press button to kick off the LSP project|
The LSP was licensed in 2008 with an initial investment capital of US$3.7 billion and three stakeholders – PetroVietnam, the Vietnam National Chemical Group (Vinachem) and Thailand’s SCG group. Vinachem sold its holdings to Qatar Petroleum International (QPI) that then resold the holdings to the SCG in early April 2017, increasing SCG's ownership rate from 46 to 71 percent.
The project’s capital was increased to US$4 billion and has been increased since to US$5.4 billion. Long Son is the third petrochemical complex in Vietnam, after Dung Quat and Nghi Son.
This is the first fully integrated petrochemical complex in Vietnam with a production capacity of 1.6 million tonnes of olefins per year, designed to annually manufacture more than two million tonnes of a wide range of petrochemical products, including polyethylene, polypropylene and other products as polyolefin import substitutes.
The refinery is expected to go into operation by 2022, and provide jobs for about 20,000 workers. Once operational, it is expected to contribute about VND2.5 trillion or US$115 million in taxes to Ba Ria-Vung Tau and state budgets per year for 30 years.
Roongrote Rangsiyopash, President and CEO of the SCG, said the LSP project would boost Vietnam’s economic growth and minimize the country’s petrochemical imports. The project will export its products, obtain a market share for Vietnamese petrochemical products abroad, and provide a platform for investment in the downstream industry and related industries in Vietnam.
Prime Minister Nguyen Xuan Phuc said at the project’s groundbreaking ceremony that the project would open up opportunities for Vietnam's oil refinery sector to carry out large-scale projects. The Prime Minister asked ministries, sectors, PetroVietnam and Ba Ria-Vung Tau Province to create favorable conditions for the project. Apart from its economic significance, the project has significant political implications for the strategic partnership between Vietnam and Thailand.
|Thai Ambassador to Vietnam Manopchai Vongphakdi said that in August 2017, Vietnamese Prime Minister Nguyen Xuan Phuc and Thai Prime Minister, General Prayut Chan-Ocha witnessed a signing ceremony of a memorandum of understanding on the LSP project in Bangkok. The project will only be successful with the support of the Vietnamese government and Ba Ria-Vung Tau Province, he added.|