The Vietnamese government will pump more capital from the State budget and provide soft loans through commercial banks to several key oil and gas projects in the country in an effort to increase domestic petroleum production and minimize imports, Deputy Prime Minister Nguyen Tan Dung has said.
Dung Quat Oil Refinery, the first oil refinery in the country capable of processing 6.5 million tons of crude oil a year, is expected to receive US$2.27 billion, the deputy prime minister said.
In order to provide sufficient money for core projects oil and gas underway like Dung Quat oil refinery and Ca Mau gas-electricity-fertilizer complex, commercial banks are allowed to lend above their limits of less than 15 per cent of their equity capital, the deputy prime minister added.
In order to ensure a sufficient amount of fuel for the domestic market and decrease the trade deficit in the next five years, the Ministry of Planning and Investment (MPI) has recently proposed bringing down crude oil exports gradually from the current level of over 18 million tons to 15.6 million tons by 2010.
When key domestic oil and gas refinery projects become operational, Vietnam will meet nearly 80 per cent of its fuel demand, or 13 million tons of petroleum products worth about US$3 billion annually by 2010, according to the Ministry of Trade (MoT).
The country, which imported 8 million tons of petroleum products in 2000 and 11.3 million tons in 2005, would only require importing 4 million tons by 2010, MoT added.
Currently, crude oil is Vietnam’s largest forex earner, which has grown rapidly over the last two years from rising global prices.
In 2005, Vietnam exported 18 million tons of crude oil worth nearly US$7.4 billion, bringing total crude oil export volume to 90 million tons over the past five years.
VNS
Vietnamese
