Vietnam Business Forum’s reporter Kim Hien discussed the opportunities and challenges of economic integration with Mr Tran Ngoc Canh, Petro Vietnam Director General.
What achievements were recorded by Petro Vietnam in 2005?
In 2005, Petro Vietnam continued to post high growth rates contributing to the economic development of Vietnam. The output was equivalent of 25.6 million tonnes of crude oil (102 per cent of the annual plan), supplying 5.3 billion cubic metres of natural gas for electricity generation domestic market, 610,000 tonnes of urea fertiliser (21,650 tonnes of ammonia). The export value of crude oil was US$7.2 billion. The turnover of the sector was VND155,000 billion and State revenue of VND52,000 billion.
Petro Vietnam has not only increased the State revenue but has also met urgent demands of the economy such as increasing the capacity of Nam Con Son gas pipeline to 18 million cubic metres per day meeting the demand of electricity supply in the dry season, starting the operation of Phu My urea fertiliser plant keeping down the price hike in the domestic market. Also in 2005, on the occasion of its 30th anniversary, Petro Vietnam on December 8, 2005 exploited the 200 millionth tonne of crude oil, and VietsoPetro joint venture exploited the 150 millionth tonne and received the Independence Order from the State.
The corporation has completed the exploration plan of 2001-2005 increasing the reserve by an equivalent of 80 million tonnes of crude oil. Petro Vietnam has also continued its good performance as an investor in Dung Quat refinery and Ca Mau gas-electricity-fertiliser project.
How can Petro Vietnam compete and develop in the economic integration process?
The annual output is equivalent to 25-26 million tonnes of crude oil (18 million tonnes of crude oil and the rest is natural gas). By 2010, the output will increase to an equivalent of 30 million tonnes of crude oil including 10 billion cubic metres of natural gas. By that time the operation will start in Dung Quat refinery, Ca Mau project, pipelines in O Mon B and Phu My, ensuring the energy supply to the economy when Vietnam integrates deeper in the regional and world economy.
In comparison with other industries, Vietnam’s oil and gas sector has had early co-operation with other countries and associations. Over the past 30 years, especially the last 15 years with the introduction of the foreign investment law, the sector has upgraded its technology and equipment, management and human resources, keeping up with international standards.
How can the sector increase its efficiency in the coming years?
The exploration of oil and gas is highly risky especially in offshore sites. To expand the exploration from now to 2020 and 2025, the Government should consider the following economic policies:
· encouraging foreign investment in offshore exploration and exploitation of small wells to make the best use of the resources.
· applying suitable financial mechanisms for exploration projects inside and outside Vietnam, as well as major investment projects under implementation.
· Completing related legal framework on consideration and approval of projects, buying companies, having legal personnel in foreign countries, complying with the financial and management mechanism of foreign investment projects and policies regarding Vietnamese workers in investment projects in foreign countries.
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