PetroVietnam lets contract for Dung Quat refinery revamp

Binh Son Refining & Petrochemical Co. Ltd. (BSR), a subsidiary of state-owned Vietnam National Oil & Gas Group (PetroVietnam), has awarded a contract to Amec Foster Wheeler for the upgrade and expansion of its Dung Quat refinery in Quang Ngai Province, Vietnam (OGJ Online, Aug. 13, 2010).

Amec Foster Wheeler will provide front-end engineering and design (FEED) for the refinery’s expansion and upgrading, which aims to increase the plant’s crude processing capacity by 30% to 8.5 million tonnes/year (tpy) from a current 6.5 million-tpy, the service company said.

In addition to design of new units as well as revamping of existing units, Amec Foster Wheeler’s scope of work will include improvements to the refinery’s configuration, coordination of technology licensors, and support services for BSR’s contracting activities on next phases of the project.

A value of the FEED contract, which is scheduled to run for 2 years, was not disclosed.

Construction on the $1.82 billion expansion and upgrade project, which received federal and provincial government investment approvals in December 2014, is scheduled to run from fourth-quarter 2017 to third-quarter 2021, BSR and PetroVietnam said earlier this year (OGJ Online, Jan. 26, 2015).

The fully upgraded and expanded refinery is scheduled to be commissioned in 2022.

The Dung Quat project investment includes the addition of refining units, work to increase capacities of existing units, revamping of auxiliary units, construction of additional oil storage and product tanks, and the addition of a single-point mooring terminal capable of accommodating vessels up to 300,000 dwt, the companies said.

In addition to enabling the plant’s flexibility to process a wider variety of crudes, the expansion and upgrade project also will equip the refinery’s production to conform to Euro 5 quality standards and increase its competitiveness in the global market, as well as reduce Vietnam’s dependence on imported petroleum products, according to BSR and PetroVietnam (OGJ Online, Aug. 26, 2014).

In April, Russia’s JSC Gazprom Neft formalized an agreement with PetroVietnam to purchase a 49% interest in the Dung Quat refinery. (OGJ Online, Apr. 7, 2015; Nov. 12, 2013).

Gazprom Neft’s share of investment in the expansion and modernization of Dung Quat, which was commissioned in 2009 and remains Vietnam’s only operating refinery, will be proportionate to its share in the plant, the Russian company said.

Contact Robert Brelsford at [email protected].