PV Power quickens work on LNG-fired power projects

VOV

PetroVietnam Power Corporation will hasten the implementation of Nhon Trach 3 and Nhon Trach 4 liquefied natural gas – fired power projects by maximizing its effort to finalize the investigation work and feasibility study of these projects within 2019.

Ho Cong Ky, Chairman of PetroVietnam Power Corporation (PV Power), unveiled the goal during a 17 June meeting aimed to review the outstanding feats which the firm achieved in the first half of 2019.

PV Power, a subsidiary of State-run Vietnam Oil and Gas Group, focused on carrying out major works in the preparation phase of the two liquefied natural gas (LNG) – fired power projects in the six-month period.

It plans to hold bidding in order to select contractors capable of executing the investigation work and feasibility study (FS) of these projects.

The power firm is scheduled to submit the FS report to the Shareholders General Meeting for approval, slated for April 2020. The bidding to select the Engineering, Procurement, and Construction (EPC) contractor will be conducted following the FS approval.

Earlier, a pre-FS report on the LNG-fired power projects received the Government approval on 27 February.

The total basic construction capital set for the two power projects is estimated at USD1.4 billion, including some USD1 billion in loans. Seven domestic banks have pledged to lend a combined total of VND25 trillion (USD1.1 billion), while some international credit institutions have committed to lending up to USD400 million without government guarantees.

LNG-fired power is an essential trend for the future development of Vietnam’s power sector amid various difficulties in expanding power generation from current sources, Chairman Ho Cong Ky noted.

He elaborated that PV Power and other power firms met a string of difficulties when attempting to increase their power generation during the first half of the year.

Challenges persisted in the domestic power generation as the water flow to nationwide hydropower reservoirs, especially in the southern region, remained low due to El Nino effects. In addition, the reserve of Nam Con Son basin and PM3-CAA gas well has been depleting.

Elsewhere, coal-fired power plants also ran into difficulties caused by the limited supply of coal from Vietnam National Coal – Mineral Industries Holding Corporation Limited (Vinacomin) and military-run Dong Bac Corporation, he said.

PV Power sold a total of 10.561 billion kWh to the national grid between January and 16 June, or 101% of the projected figure. The corporation’s combined revenues reached VND14.812 trillion (USD636.91 million) during the first five months of 2019. It also posted after tax profits of VND1.319 trillion (USD56.71 million) in the five-month period, representing 129% of the planned number.

PV Power, with the stock code POW, has enjoyed a strong performance and increased financial capacity in the wake of its initial public offering (IPO) which took place in January 2018.

The PV Power chairman underpinned his view that the average value of POW stocks reached VND14.938 (64.2 US cents) at the IPO. POW listed on the Ho Chi Minh Stock Exchange (HoSE) on 14 January this year stood at VND14.900 (64.07 US cents). POW continued to enjoy a bullish period when it closed at VND15.950 (68.58 US cents) on 17 June.

This year, PV Power is striving to complete its yearly power generation plan of 21.6 billion kWh and earn VND33.9 trillion (USD1.45 billion) in gross revenue, and VND2.9 trillion (USD124.7 million) in gross profit.

The firm looks to rack up some VND2.3 trillion (USD98.9 million) in after-tax profits this year, far beyond the yearly plan assigned during the 2019 Annual General Meeting.