News | October 15, 2021

Vietnam's US$2bn LNG Power Plant Gets Approval

Vietnam’s government has approved the construction of a 1.5 gigawatts (GW) liquified natural gas (LNG) power plant with VND54 trillion (US$2.3B) investment.

The main investor in the project is Vietnam’s T&T Group, contributing 40% of the total investment. The other investors are Hanwha Energy Corporation, Korea Southern Power and Korea Gas Corporation.

The power plant is the first stage of the Hai Lang LNG electricity centre in Quang Tri province, north Vietnam, which will be delivered in three stages. Besides the 1.5GW LNG power plant, the first stage also includes an LNG port with the capacity to handle LNG carriers ranging in size from 170,000 to 226,000 cubic meters, carrying 1.5 million tonnes of LNG per year.

Renewables expert John Yeap of Pinsent Masons, the law firm behind Out-Law, said: “LNG as a transition fuel to net zero makes sense for countries such as Vietnam with its high demand growth. In the absence of large renewable generation such as offshore wind or concentrated solar power (CSP) that could, when teamed with storage, be scaled to meet the demand growth, burning natural gas is a better option then burning coal.”

“However ultimately the goal is net zero so neutrality can only be achieved through the eventual removal of emissions-based generation or increasing carbon abatement through carbon sinks and the like,” he said.

The first stage is expected to become operational by 2027 and the total generating capacity of the complex will reach 4.5GW once stages 2 and 3 are completed.

In February, the complex was approved by Vietnam’s prime minister, who incorporated stage 1 into the country’s revised Power Development Master Plan VII (PDPVII). Stage 2, which is scheduled to double the generating capacity of the first stage to 3GW, will be considered as part of PDPVIII.

T&T Group proposed the project in 2019 and received approval from the local government on its research and proposal document. Quang Tri is set to become an energy hub in the central region by 2030.

Source: Pinsent Masons LLP