Gazprom EP International in Vietnam

The strategy of the Gazprom Group of pursuing new international markets views Vietnam as one of the Asia-Pacific (AP) countries with most potential for energy projects. Apart from the evident cost-effectiveness of cooperating with Vietnam, Gazprom sees the possibilities of using the most advanced and proven technologies in the field of energy.

With a representative office in Hanoi, Gazprom EP International promotes the interests of Gazprom in the Socialist Republic of Vietnam. In partnership with PetroVientnam, the company also participates in joint ventures based in Hanoi and other Vietnamese cities.

Currently, Gazprom EP International is preparing for the implementation of the Quang Tri Gas-Fired Power Plant construction project, and actively participates in the development of Vietnam’s NGV market in cooperation with PV Gas.

History of cooperation

The partnership with Vietnam started in 1997 when the Memorandum of Cooperation was signed between the Gazprom Group and PetroVietnam.

The next important step was signing the Strategic Partnership Agreement in 2009 that covered cooperation in oil and gas projects in Russia, Vietnam, and third countries. From this moment, the active phase of cooperation began.

In 2012, the five-year Agreement on Personnel Training and Retraining was signed whereby the Vietnamese specialists undertake a traineeship and study within and outside Russia, including the production facilities of Gazprom EP International.

To develop one of the strategic areas of joint activities, the Russian-Vietnamese NGV joint venture PVGAZPROM Natural Gas for Vehicles was established and registered in 2015.
The JV is composed of Gazprom EP International (35.5 %), Gazprom Gazomotornoye Toplivo LLC (35.5 %), and PV Gas (29 %).

In 2016, Gazprom PJSC and PetroVietnam signed a document package aimed at cooperation development: a Memorandum of Understanding on New Oil and Gas Projects Development, a Memorandum of Understanding on Energy Generation and an Addendum on the extension of the Agreement on Cooperation in Personnel Training. The documents provide for the implementation of new oil and gas projects within and outside Vietnam, joint projects in the field of gas-fired power generation in Vietnam, as well as an Agreement on Cooperation in Personnel Training for 5 years.

Power Plant Construction in Quang Tri

In 2018, Alexey Miller, Chairman of the Gazprom Management Committee, Nguyen Vu Truong Son, Director General, Member of the Petrovietnam Board of Directors, and Nguyen Quan Chinh, Deputy Chairman of the People’s Committee of Quang Tri Province, signed a Memorandum on the Roadmap for the Development of the Integrated Project of Bao Vang Field — Power Plant Construction in Quang Tri Province.

In December 2018, by decision of the SRV Government, the power plant was included in the Energy Sector Development Plan of Vietnam — PDP-VII. In the beginning of 2020, Gazprom EP International was appointed as the investor of this project.

The company is preparing a feasibility study in accordance with the requirements of the Vietnamese laws and is ready to start the active phase of the project.

NGV market in Vietnam

In 2013, Gazprom and Petrovietnam entered into an Agreement on the Joint Venture for the Production and Use of Liquefied Natural Gas as Motor Fuel in Vietnam. At the same time, Gazprom EP International began the implementation of that project.

In 2015, a Russia-Vietnam JV called PVGAZPROM NGV LLC was founded. The joint venturers are: Gazprom EP International (35.5%), Gazprom Gazomotornoye Toplivo LLC (35.5%), and PV Gas (29%).

The main objective of the company is to organize the production of eco-friendly LNG motor fuel in Vietnam. PVGAZPROM NGV has carried out marketing research of potential demand for NGV (natural gas for vehicle) in the segments of road and water transport in Ho Chi Minh, the country’s largest megalopolis, and other eight neighboring provinces of the key economic region of Southern Vietnam. The feasibility study of the pilot project that included the construction and operation of a small-scale plant for the production of 14 thousand tons (20 million normal cubic meters) of LNG per year, creation of a transport and logistics facility, and installation of a network of mobile cryogenic gas filling stations.

In 2019, PVGAZPROM NGV announced an international tender to select contractors for the development of project documentation, supply of equipment, and construction of a LNG complex with a capacity of 20 million normal cubic meters per year.

The active phase of works is scheduled for this year.