This is one of the proposals SCG has sent to Prime Minister Nguyen Xuan Phuc. The group has asked to acquire 29 percent of PetroVietnam’s stake at LSP, attached with some conditions to implement the project, reported online newspaper ndh.vn.
The proposal was sent after PetroVietnam had difficulty arranging its loan portion in the joint venture and in procedures for approving bidding packages. This has a direct impact on the progress of the Engineering Procurement and Construction (EPC) contract and as well as the project. Therefore, the bidding package has had to be extended many times since Long Son Petrochemical Company Limited approved the results regarding the selection of EPC contractor in early July 2017.
If this proposal is approved by the Prime Minister, SCG will own 100 percent of the 5.4 billion USD petrochemical project.
The LSP Complex was licensed in 2008 with an investment capital of 3.7 billion USD and participation of PetroVietnam, Vietnam National Chemical Group (Vinachem) and SCG Group.
After many difficulties, Vinachem withdrew the capital and was replaced by Qatar Petroleum International (QPI). In April 2017, QPI also decided to withdraw all capital at LSP and transferred the amount of stake to SCG. As a result, SCG’s capital in LSP increased from 46 percent to 71 percent.
Initially, the project had an investment of about 3.7 billion USD, which was increased to more than 4 billion USD, and finally to the current investment of 5.4 billion USD. Long Son is the third petrochemical complex in Vietnam, following Dung Quat oil refinery and Nghi Son oil refinery and petrochemical complex.
LSP is a key petrol and oil project of the Vietnamese Government. It is designed to have a capacity of 1.6 million tonnes of olefin per year.
Located on 464ha in the LSP Industrial Park, the project is expected to be operational by 2022.
During the construction process, the project is expected to create some 15,000-20,000 jobs. Once complete, it will create more than 1,000 jobs and is estimated to contribute some $115 million a year to the local budget.