Vietnam Expands in Petchems and Plastics

26.08.2022 - Vietnam is on its way to becoming a major Asian player in petrochemicals and plastics. Up to now, the country has lagged regional peers such as China or Malaysia in bringing new production facilities on stream, but this is slowly changing.

From 2023 to 2026, the country will see a considerable buildup of polyolefin capacity. If all the projects announced to date go ahead as planned, the country’s PP output could more than double in the next three years, and the island nation could also produce polyethylene for the first time.

Currently on the drawing boards are new plants with capacity for altogether 1.4 million t/y of PP and 900,000 t/y of PE.

To implement its growth plans more quickly, the government in Hanoi is taking private partners on board and also plans to extend the geographic spread of production farther northward. At present, most of the output capability is concentrated near Ho Chi Minh city, the former Saigon.

Privately owned multinational group Stavian, based in Hanoi, recently signed a memorandum of understanding (MoU) with the provincial government of Quang Ninh and management of the Bac Tien Phong industrial zone to build a $ 1.5 billion plant for PP in the area that borders China.

The new 600,000 t/y facility, to be operated by Stavian Quang Yen Petrochemical, a joint venture of Stavian Chemical and Yen Hung Liquid Porti, is expected to be on stream by 2026. A propane dehydrogenation (PDH) unit is also planned to be part of the project.

Stavian said the PDH technology will be supplied by Honeywell UOP, while the PP production technology, which it touts as environmentally friendly and capable of reducing greenhouse gas emissions, would come from LyondellBasell.

The group already has plants in the northern provinces of Hung Yen and Hai Duong, with a portfolio encompassing mainly standard thermoplastics in addition to a limited number of engineering grades.

Along with being a producer, Stavian is Vietnam’s largest plastics distributor, up to mid-2021 trading as Opec Plastics. Complementing its strong position in Southeast Asia, the distribution side also has offices in the US, Russia, China, India, South Korea, Singapore, Indonesia and the Philippines.

Upstream and downstream in one complex

In another major new project, Vietnam Oil and Gas Group (Petrovietnam) has proposed that the government invest in an integrated petrochemical and refinery complex with national oil storage in Long Son oil and gas industrial park.

The facility planned to be completed in two phases in the southern province of Ba Ria-Vung Tau at an investment of nearly $19 billion would comprise two parts – a petrochemical and refinery plant project and a project to build a national storage for crude oil and petrol products.

In the first phase, the petrochemical and refinery complex would be able to process 12-13 million t/y of crude oil, along with 660,000 t/y t of condensate, LPG and ethane. The designated annual output would total 7-9 million t of petroleum and 2-3 million t of petrochemicals.

In the second phase, output would increase by 3-5 million t of petroleum and 5.5-7.5 million t of petrochemicals.

Petrovietnam plans to submit dossiers to the government in January 2023. The feasibility study would follow from June to December that year, and the investment could be approved by first quarter of 2024. The company would select the engineering, procurement and construction contractors in the period from January 2024 to December 2027.

The plans are aimed at boosting Vietnam’s domestic production capacity of petrol products, which is currently much lower than demand would warrant. The country spends billions of dollars annually to import petrochemical products to meet domestic consumption needs.

Author: Dede Williams, Freelance Journalist