Bac Lieu People’s Committee and Delta Offshore Energy Pte., Ltd. will negotiate the power purchase agreement for Bac Lieu LNG-to-power project this month in order to hold the signing ceremony later this year.
|The power purchase agreement of LNG Bac Lieu will be signed this month (Illustration) |
The prime minister asked Bac Lieu People’s Committee to co-operate with ministries and relevant authorities to support investors to complete investment procedures to ensure that the project is implemented on schedule.
If difficulties arise during implementation, the province will be in charge of presenting solutions to the prime minister for approval, even proposals exceeding the province's authority to ensure the project’s construction process.
Previously, the National Steering Committee for Power Development proposed the investor of the Bac Lieu LNG-to-power project to keep the selling price of power at 7 US cent per kWh to make negotiations quicker.
According to a source of Baodautu, the investor had at least one online and one offline working session with EVN relating to the power purchasing agreement (PPA). Notably, in May, the two parties discussed the project’s timeline with a focus on completing the PPA, including the grid interconnection agreement, by the end of this year. Delta Offshoe Energy (DOE) presented updates on the progress of the project, as well as stressed the urgency of organising the PPA discussions to facilitate its signing by October 2020.
DOE contracted the Institute of Energy, Vietnam’s leading energy technical advisor under the Ministry of Industry and Trade, to complete the grid interconnection report, feasibility study, and the environmental impact assessment as prerequisites for key approvals and agreements with the Vietnamese government. DOE also hired expert international consultants to help complete the feasibility study by September 2020, but the document has yet to be completed.
A number of investors said that the lack of a government guarantee for this project forced them to expend much more effort to mobilise capital. As the project’s investment capital is $4 billion, with 80-85 per cent sourced from loans mainly from overseas, the investors have their work cut out for them.