Business

Russian contractor seeks to withdraw from billion-dollar power project in Vietnam

Published

1 year ago

March 9, 2022

Russian power engineering company Power Machines is seeking to withdraw from the billion-dollar Long Phu 1 thermal power plant project in Vietnam due to U.S. sanctions.

Russian contractor seeks to withdraw from billion-dollar power project in Vietnam

The construction site of the Long Phu 1 thermal power plant project. The project has been suspended since Power Machines was subject to sanctions from the U.S. – PHOTO: VNA

Speaking to Tuoi Tre Online on March 8, a leader of the management board of the Long Phu 1 thermal power plant project said the board has proposed that the Vietnam Oil and Gas Group (PVN) terminate the engineering, procurement and construction (EPC) contract for the project with Power Machines.

The management board explained that the Russian contractor is subject to sanctions from the U.S. and is hardly able to implement the EPC contract.

The 1,200 MW coal-fired Long Phu 1 thermal power plant has been being developed in Long Phu District in the Mekong Delta province of Soc Trang. The joint venture between Power Machines and PetroVietnam Technical Services Corporation, a member of PVN, is the EPC contractor of the project, with the EPC contract worth US$1.2 billion.

According to the EPC contract that was signed in 2014, the first steam turbine of the plant will be put into operation in October 2018 and the second turbine in February 2019.

However, in 2018, Power Machines was subject to U.S. sanctions following the annexation of Crimea by Russia. At that time, the Long Phu 1 thermal power plant had been approximately 72% complete.

The leader of the management board of the Long Phu 1 thermal power plant project said after Power Machines faced sanctions, the Russian contractor struggled to implement the EPC contract and the project was suspended when it was 77.56% complete.

In February 2019, Power Machines suspended the EPC contract for “force majeure reason”. However, the Vietnamese investor didn’t accept the U.S. sanctions on Power Machine as the “force majeure reason”.

In September 2019, Power Machines sued the investor and PetroVietnam Technical Services Corporation at the International Arbitration Center in Singapore. Power Machines wanted to withdraw from the project with zero losses and asked the Vietnamese side to compensate for all the money the company had spent.

However, when the negotiations were still ongoing, the Russia-Ukraine crisis occurred and several Russian banks were removed from the SWIFT international payments system, limiting their transactions via the banking system.

According to the management board of the Long Phu 1 thermal power plant project, even if both sides come up with the compensation for Power Machines, payments cannot be made.

“To minimize losses and take advantage of the EPC work that has been done, we propose preparing necessary procedures to select the new EPC contractor and resume the project as soon as possible,” Nguyen Doan Toan, head of the project’s management board, said.

Up to now, the Vietnamese side has invested nearly VND13 trillion (US$570 million) in the project.

Source: Saigon Times

Source: https://vietnamnet.vn/en/business/russian-contractor-seeks-to-withdraw-from-billion-dollar-power-project-in-vietnam-821402.html

Business

PV Power receives “BB” rating for third consecutive year

Published

3 mins ago

June 8, 2023

TienphongNews

Fitch Ratings has affirmed PetroVietnam Power Corporation (PV Power)’s long-term foreign-currency issuer default rating (IDR) at “BB” with a positive outlook.

PV Power receives “BB” rating for third consecutive year hinh anh 1

Workers at Ca Mau 1 power plant (Photo: VNA)

Hanoi – Fitch Ratings has affirmed PetroVietnam Power Corporation (PV Power)’s long-term foreign-currency issuer default rating (IDR) at “BB” with a positive outlook.

This is the third consecutive year that PV Power has received “BB” rating with a positive outlook, the highest rating that a Vietnamese company can reach.

The rating, which is based on PV Power’s Standalone Credit Profile (SCP) assessment of “BB”, is on a par with the IDR of its 80% parent, Vietnam Oil and Gas Group (PVN, BB/Positive).

PV Power‘s SCP is driven by its strong market position as Vietnam’s second-largest electricity producer, accounting for around 5% of the country’s total electricity output and 5% of installed capacity in 2022. It also benefits from diversified fuel sources, long-term power-purchase agreements (PPAs) with Vietnam Electricity (EVN, BB/Positive) for more than 80% of its electricity output and a strong financial profile.

However, EVN’s IDR constrains PV Power’s SCP, even though PV Power’s financial profile is stronger than its SCP assessment indicates. The positive outlook is driven by the positive outlook on EVN’s IDR.

The rating is expected to help the firm attract more attention from international credit institutions. Currently, PV Power is investing in many projects with large capital needs such as Nhon Trach 3 & 4 Power Plants and a power project using imported liquefied natural gas (LNG) in Quang Ninh.

As of the end of the first quarter this year, PV Power’s total electricity production had surpassed 4 billion kWh, exceeding its plan by 16%, with a revenue of 7.91 trillion VND (337.04 million USD), 20% higher that its quarterly plan, up 10% year on year./.

Source: https://en.vietnamplus.vn/pv-power-receives-bb-rating-for-third-consecutive-year/253813.vnp

Business

Vietnam Fisheries Trade Union raises fishermen’s awarness on combatting IUU fishing

Published

1 hour ago

June 8, 2023

TienphongNews

Vietnam Fisheries Trade Union (VFTU) on May 29 held a communication event aiming to raise awareness of union members on national sovereignty over seas and islands as well as on the prevention and combat of illegal, unreported and unregulated (IUU) fishing.

Vietnam Fisheries Trade Union raises fishermen's awarness on combatting IUU fishing hinh anh 1

To remove the European Commission’s yellow card, it is necessary for ship owners to comply with legal documents on seas and islands while operating at sea. (Photo: nongnghiep.vn)

Khanh Hoa – Vietnam Fisheries Trade Union
(VFTU) on May 29 held a communication event aiming to raise awareness of
union members on national sovereignty over seas and islands as well as on the
prevention and combat of illegal, unreported and unregulated (IUU) fishing.

Participants at the event were updated on the current
situation of the country’s sea and islands, efforts to combat IUU fishing associated with the responsibilities of union members and fishermen towards having the “yellow card” imposed by the European Commission
on Vietnamese fishery products removed.

According to the Vietnam General Confederation of Labour, the
VFTU has 90 chapters in 16 out of 28 coastal provinces and cities, with nearly
18,000 members and over 5,200 fishing vessels of more than 15m in length.

In recent years, the VFTU has been proactive in popularising legal
documents on seas and islands and calling on its members and boat owners to combat
IUU fishing. It has coordinated with relevant agencies in providing national
flags, first aid kits and life vests to fishermen.

Vietnam Fisheries Trade Union raises fishermen's awarness on combatting IUU fishing hinh anh 2

At the signing ceremony (Photo: nongnghiep.vn)

The trade union has timely issued statements rejecting the unilateral fishing ban in the East Sea by foreign countries, as well as protesting acts that hinder, drive away, attack and arrest people and property of union members and Vietnamese fishermen.

At the event, the
VFTU signed several cooperation agreements with enterprises such as Son Ha Group, Bao Viet Insurance Corporation and
Minh Hong Phuc Vietnam Co. Ltd. These agreements will create favourable
conditions for union members to access products and services at preferential
prices, thereby helping them feel secure while operating at sea, contributing
to protecting the country’s sovereignty over sea and islands./.

Source: https://en.vietnamplus.vn/vietnam-fisheries-trade-union-raises-fishermens-awarness-on-combatting-iuu-fishing/253811.vnp

Business

Vietnamese durian gets more farming area codes for export to China

Published

2 hours ago

June 8, 2023

TienphongNews

China has approved another 47 farming area codes and 18 packaging facility codes for importing durian from Vietnam, according to Ministry of Agriculture and Rural Development.

Vietnamese durian gets more farming area codes for export to China hinh anh 1

Illustrative image (Photo: thanhnien.vn)

Hanoi – China has approved another 47 farming area codes and 18
packaging facility codes for importing durian from Vietnam, according to
Ministry of Agriculture and Rural Development.

Farming area codes enable traceability and thus agricultural exports.

To qualify for export to China, durian need to weigh three kilogrammes or more,
meet stringent safety standards, have traceability stamps in English or Chinese,
and show the name of the packaging facility.

China, the world’s largest durian market, began importing the fruit from Vietnam
last year after approving 51 farming area codes.

The number has since increased to 293 along with 115 packaging facility codes.

According to statistics from the General Department of Customs, durian has been
identified as the fruit with the highest economic value.

Its exports in the first quarter were worth 153 million USD, 8.3 times up from
the same period last year, of which China accounting for 83%.

Dang Phuc Nguyen, general secretary of the Vietnam Fruit Association, said the
fact that more farming area codes and packaging facility codes had been
approved by China was good news for durian growers and exporters.

It would enable Vietnam to increase exports to China, where demand is enormous./.

Source: https://en.vietnamplus.vn/vietnamese-durian-gets-more-farming-area-codes-for-export-to-china/253798.vnp