Oil and gasoline performs an important role in the global economics typically and Vietnam’s significantly. Other than its financial advantages, it is the vital vitality in day by day life, engages a lot of certified employees into the industry. Let’s take a more in-depth look at the Vietnam oil and fuel trade, its SWOT. Certainly, higher understanding of this industry in Vietnam will better your chance of successfully establishing companies, investing in Vietnam, hiring Vietnamese staff in oil and fuel.
1. Construction of Vietnam oil and fuel sector
The oil and gas sector in Vietnam has been dominated by Vietnam Oil and Fuel Group (PetroVietnam – PVN) and managed by the Ministry of Trade and Trade. In Vietnam, this sector is one in every of high priorities for the event, as it is seen as the important thing to national financial growth and power safety. It is the country’s largest overseas present earner and considered one of main procurers of imported know-how. Crude oil has earned over $17 billion for Vietnam since its first export shipment in 1987. This business contributes $1 billion to the State finances yearly.
PVN and Vietnam Nationwide Petroleum Group (Petrolimex) are the two largest players in oil and fuel. While Petrolimex is now concerned solely in transportation and distribution, PVN additionally produces refined merchandise and fuel processing. Established in 1975, PVN is the only home petroleum company and represents the Vietnam government in working and managing Vietnam oil and gas trade. This group’s income primarily comes from oil and gas production, urea manufacturing, energy production, manufacturing of petroleum, petrochemical products, petroleum buying and selling activities. In the meantime, Petrolimex was established from equalization and restructuring of Vietnam National Petroleum Corporation. Petrolimex’s main business scope is importing, exporting and dealing in petroleum, refining and petroleum products, investing in other fields that Petrolimex is operating and other sectors allowed by the law.
2. Oil and gas production
It isn’t exaggerating to claim that Vietnam is biased with plentiful natural resources. This country has amazing potential in oil and gas reserves, mostly positioned within the South of Vietnam.
Vietnam’s crude oil reserves are the second largest in East Asia, simply behind China, with 600 million barrels. Largest oil producing fields here are Bach Ho (White Tiger), Rang Dong (Dawn), Dai Hung (Large Bear), Hold Ngoc, Su Tu Den (Ruby). Averagely, 500,000 barrels of crude oil are produced per day. Within the quick time period, new projects will keep growing output; and in the long run, a lack of major new projects will make production decline, elevating requirement for web crude import to 100 700b/d by 2022.
As an oil exporter, Vietnam has been supplying around zero.6% of the global demand. The United States is the largest importers of crude oil from Vietnam, holding 27.9% of Vietnam’s export quantity. Singapore takes 27% of the country’s export volume, adopted by Japan 22%, China 18%, Netherlands 2.Eight%, and Malaysia 2%.
Vietnam- Pure Gas Production, Import Capability and Consumption (Cr: BMI Research)
Apart from crude oil, Vietnam is rich in natural gasoline, too. It has proven gas reserves of almost 7 trillion cubic toes in serveral fields – eg., Cuu Long basin offshore from Mekong Delta in Southern Vietnam, Tien Hai (Thai Binh), Lan Tay/ Lan Do in Nam Con Son basin off South Vietnam, and many others. Vietnam’s pure gas production and consumption have been growing quickly because the late 1990s, and primarily for home demand. In accordance with BMI Research (UK), its consumption in Vietnam will grow strongly by nearly 60% over the following decade due to wider application of CNG-fuelled autos in the transportation sector and increasing fuel-fired electricity generation in the power sector. This will result in the country’s gasoline demand growing at averagely 4.9% per 12 months over the subsequent decade, from 8.8 bcm in 2014 to 14.1 bcm in 2024. LNG imports are anticipated to entail.
Three. Refinery and petrochemical business – Rising sector in Vietnam and Nice interest to foreign buyers
The refinery Dung Quat within the central province of Quang Ngai
Below Vietnam’s WTO commitments, within the upstream segment, foreign firms are allowed to discover oil and gasoline independently. Although there requires the presence of PVN – one in all biggest gamers in Vietnam oil and gasoline – in all producing initiatives, worldwide oil companies are allowed to hold majority stakes and gain a share of output. In the meantime, within the downstream segment, the Vietnamese government has allowed the involvement of personal sector and overseas corporations. That means capital, expertise and superior know-how are being introduced in to assist improve refining capacity in Vietnam. With the government’s openness to foreign partnership, increasingly more corporations have interests in Vietnam’s refinery and petrochemical sector, especially companions from Japan, Kuwait, Thailand, UK, Russia, the U.S, India, South Korea.
Dung Quat (Quang Ngai province) – the first refinery in Vietnam – got here into operation in 2009. The overseas oil companies, together with Essar Group (India), Royal Dutch Shell (Netherlands) and SK Power (South Korea) were negotiated to improve and promote a part of this refinery. The refinery’s most capacity is 6.5 million tons of crude oil/ yr, equally to 148,000 barrels/ day.
One other venture is Nghi Son refinery (Thanh Hoa province). This can be a joint enterprise between Vietnam’s oil and fuel major PVN (contributing 25.1% of the capital) and worldwide companies, together with, Kuwait Petroleum Worldwide and Idemitsu Kosan (Japan) (every holding 35.1%), whereas one other Japanese firm, Mitsui Chemicals, has the remaining four.7% of stake. Nghi Son is the second and largest oil refinery project in Vietnam. It’s anticipated to operate in 2017 and attain the maximum capability of 10 million tons in 2018.
Vietnam is planning to assemble some refineries – they are: Lengthy Son refinery (Vung Tau province), Van Phong refinery (Khanh Hoa province), Vung Ro refinery (Phu Yen province).
Four. Oil and gas manpower
Vietnam has been considered one of the highest attractions to international buyers in oil and gasoline not only because of the changes to government policies – i.e. permitting foreign possession of bigger firms, vital funding in infrastructure, but in addition due to this country’s effectively-educated workforce.
Certainly, this sector growing quick in Vietnam has been attracting lots of workers and induces more investment in HR growth. There have been about 2,000 employees within the trade in 1975 when PVN was founded; 21,000 in 2005; 35,000 in 2009; 44,000 in 2010; 60,000 in 2011. Throughout 2012-2015, the oil and gasoline business maintained hiring a secure number of staff in oil and gas sector. Workforce on this sector is well educated at larger degree than employees in different sectors. Ninety% of staff are involved in long-term training. The rate of staff with greater training or above degree is excessive, too, and increasingly larger. Plus, Vietnam manpower has more alternatives to entry superior technologies followed by the country’s expanding exploitation, oil production and refining. Regardless of higher accessibility to applied sciences, that still doesn’t totally the demand. That’s why with eagerness to study, more and more staff in Vietnam have chosen to work in international countries like Dubai to be upgraded with reducing-edge technologies aside from, in fact, earning more cash.