Another oil refinery bites the dust in Vietnam

Vietnam’s southern city of Can Tho has announced that it has cancelled the license of a USD538-million oil refinery project due to delays in the project implementation.

According to a local newspaper, Dau Tu, the government of the Mekong Delta province, which has jurisdiction over the city of Can Tho, cancelled the license because the investors have not started construction of the oil refinery, even though it received its license eight years ago.

The license was initially granted to a joint venture between U.S.-based Semtech Limited BVI and Vietnam’s Vien Dong Investment and Trading Company. However, the U.S. partner pulled out in November 2009 for financial reasons. Razeedland Plaza Sdn Bhd, a unit of Brunei’s SGB Refinery Petrochemical Corporation Sdn Bhd, stepped in earlier this year, but up to now has not been able to start construction.

The refinery was designed to process two million tonnes of crude oil annually or 40,200 barrels per day. It was the largest foreign-invested project  in Can Tho.

The cancellation of the refinery in Can Tho is the second in Vietnam to be cancelled this year, after PTT dropped out of the oil refinery project in the central province of Binh Dinh.

So far, the Dung Quat oil refinery in Quang Ngai Province is the only oil refinery operating in Vietnam. The Nghi Son oil refinery  in Thanh Hoa Province, is still under construction and is scheduled to start commercial operations next year.