Russia’s Gazprom Neft has suspended talks to purchase a 49% interest in Vietnam’s Dung Quat Oil Refinery, according to a notification the Russian oil major sent to PetroVietnam, Vietnam’s Tuoi Tre News reported.
PetroVietnam notified Gazprom Neft last December that it planned to reorganize the refinery’s owner and operator, Binh Son Refining and Petrochemical, as a stock company, in line with the Vietnamese government’s restructuring plans.
Gazprom Neft and PetroVietnam signed a framework agreement on the Dung Quat refinery covering investment in Binh Son Refining and Petrocemical Co. Ltd. and expansion of the Dung Quat facility.
Gazprom began a valuation of the stake and entered into negotiations on supplying crude oil to the refinery. Gazprom Neft estimated that it would cost USD 1-1.5 billion to modernize the refinery.
Russia and Vietnam planned to sign an intergovernmental agreement on Gazprom Neft’s purchase of a 49% interest in Dung Quat, but the Vietnamese party put off signing the document after talks of another Russian state company, Rosneft, entered the negotiations.