Measures needed for delayed thermal power projects of PVN

The Vietnam Oil and Gas Group (PVN) on July 4 provided information about the 3 major thermal power projects which are slow in progress.

The construction site of Long Phu 1 thermal power plant.
The construction site of Long Phu 1 thermal power plant. 

Thai Binh 2 thermal power plant

85% of the Thai Binh 2 thermal power plant has so far completed t. The first unit will be ready to generate electricity in June 2020, while the second one will be completed 4 months later.

The main reasons for the delay include wrongdoings of the general contractor, which are being handled by the authorities, and misuse of capital leading to increased costs, slow construction progress and legal issues.

Pham Huy Vuong, Head of the Electricity Department of PVN, suggested that the competent agencies should check and take over individual sections of the project and then continue releasing capital to the remaining ones.

He also highlighted the importance of ensuring a long-term supply of coal for the plant.

Long Phu 1 thermal power plant project (Soc Trang)

About 80% of the project has been completed. The delay has resulted from the U.S government embargo on the general contractor, Russia’s Power Machines, starting from January 26, 2018.

Power Machines on January 28, 2019, officially announced to end the EPC contract. Power Machines has in fact stopped the construction since March 15, 2019.

Song Hau 1 thermal power project

The power project costs over 43 trillion VND. It is the most promising out of the three, although the construction progress is slow compared to its schedule for 2012.

So far, about 73% of the project has been done. PVN expected to complete the construction of most items of the plant in 2019, conduct a trial run of a number of units such as demineralized water system, oil system, or electrical equipment.

PVN has asked the Government, relevant ministries and agencies to support the group and offer solutions to each project.

PVN also proposed that the Ministry of Industry and Trade and the State Capital Management Committee soon have a written report to the Prime Minister approving PVN to use its capital for the projects if the actual costs of the projects won’t exceed their adjusted total investment. At the same time, PVN will be responsible for the technical matters while producing electricity. When the supplemental funding is reimbursed to the projects, PVN will take back the advance. 

By Duy Tien

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