By Miyoko Ishigami
(with photo) TOKYO, April 25 (KUNA) -- Kuwaiti Oil Minister Sheikh Ahmad Al-Abdullah Al-Sabah on Saturday voiced his country's determination to step up collective efforts with Japanese firms in bringing a joint project in Vietnam to a successful conclusion.
In an interview with Kuwait News Agency (KUNA) here, while expressing satisfaction with its development to date, the minister said that construction work has already began in the joint venture, for the envisaged refining and petrochemical complex in the northern province of Thanh Hoa.
Kuwait Petroleum International (KPI), an international unit of Kuwait Petroleum Corporation (KPC), established the joint venture in April last year with Japanese major refiner Idemitsu Kosan Co. and Mitsui Chemicals Inc., as well as state-owned PetroVietnam.
"The project will utilize Kuwait's stable crude oil supply and Japanese firms' oil refining and petrochemical business experiences in Vietnam, where demand for oil products is rapidly increasing," said Shiekh Ahmad.
If it goes onstream in 2013 as originally scheduled, the plant, located about 180 kilometers south of the capital Hanoi, would become the first-ever Kuwait-Japanese joint venture in building a refinery in a third country. The participating companies are currently drawing up basic equipment design and engineering plan for the complex.
The Nghi Son Petrochemical Refinery Complex, the largest and most important refining project in energy-hungry Vietnam, has a total investment capital of USD 6.0 billion for the first stage. KPI and Idemitsu evenly own a 35.1 percent stake in the joint project with a capitalization of USD 200 million, with PetroVietnam and Mitsui putting up 25.1 percent and 4.7 percent.
With a refining capacity of 200,000 barrels per day (bpd), the refinery will be designed to process 100 percent Kuwaiti crude supplied by KPC. When running in full, the capacity is expected to be doubled in the future. According to KPC, the plant will turn crude oil into petrol, liquefied petroleum gas, diesel, kerosene and jet fuel for Vietnam, which has offshore oil reserves but now imports petroleum products.
Vietnam's joint venture is in line with Kuwait's long term strategy for investments in large-scaled refining, petrochemical and infrastructure projects in Asia. It also comes as Kuwait has been pushing forward downstream investments in China and India, a move that would serve as a stepping stone to Kuwait by adding values to its crude and securing stable customers in the world's fastest-growing economies.
Nghi Son is the country's second oil refinery after its first 148,000-bpd plant in central Quang Ngai Province, which commenced operation in February. The Kuwaiti-Japanese project is expected to contribute half of Vietnam's demand for petroleum products by 2015. (end) mk.ema KUNA 251206 Apr 09NNNN