The Prime Minister has given the green light to a US$27-billion oil refinery project to be invested by the Petroleum Authority of Thailand (PTT) in Binh Dinh province, announced a provincial leader.

Ho Quoc Dung, Deputy Chairman of the Binh Dinh provincial People’s Committee, made the announcement at an online forum organised by the Government portal on May 12.

Dung revealed that the provincial administration and the Thai side signed a memorandum of understanding (MoU) in April 2013 on implementing the project, the largest of its kind, in Binh Dinh’s Nhon Hoi Economic Zone (EZ) after three years of negotiations.

He removed public worries about the feasibility of this mammoth project, saying the local administration has already worked and appraised the Thai group’s financial capacity.

He said PTT is a large financial group with a total asset of more than US$150 billion, ranking among the world’s top 100 financial giants. It records annual revenue of over US$80 billion and earns nearly US$3.5 billion in profit.

The Thai group has decided to invest in Nhon Hoi EZ as the zone has good infrastructure, a low-cost labour force and the lowest land rental in the region. It also has deep a water sea port located along the national north-south trade route, as well as the route from Vietnam to overseas markets.

Head of the Ministry of Planning and Investment (MPI) Economic Zones Management Department Vu Dai Thang said it is a very large project given the current difficult economic circumstance and the MPI has regularly made appraisal reports to evaluate the feasibility of the project.

Construction of the project is expected to begin in 2016 and to churn out commercial products in mid-2020. The refinery is designed to have an annual capacity of 30 million tonnes.

Crude oil will be imported from the Middle East, Africa, and South America to feed the plant which is to produce more than 20 types of products for export.

According to the agreement, PTT will contribute 50-60 percent of the project’s total investment and the remaining sum will be mobilised from both domestic and international investors.

Although the Vietnam Oil and Gas Group claims that the Nhon Hoi project may cause an imbalance in supply and demand of oil, Deputy Minister of Industry and Trade Ho Thi Kim Thoa has voiced her ministry’s support for the project.

Binh Dinh is currently emerging as an attractive destination for investors. Last year, the province ranked fourth in the investment capacity index, climbing up 34 notches from the previous year.

VOV