Bidding cancelled a third time on LNG-fired power plant

Bidding cancelled for the third time for the Nghi Son LNG-fired thermal power plant. The illustration image

According to Thanh Hoa Nghi Son Economic Zone and Industrial Parks Management Board, the board issued the third tender notice for the Nghi Son LNG project, with the initial bidding deadline set for April 10.

On March 23, the province extended the deadline to April 20 to revise the tender documents and update the Power Purchase Agreement template at Vietnam Electricity’s request. However, no investors had submitted applications by the closing date.

During the bidding process, the locality also stepped up efforts to attract investors. In late March, Thanh Hoa People’s Committee established a task force, headed by Standing Vice Chairman Mai Xuan Liem, to support liquefied natural gas (LNG) thermal power projects, resolve bottlenecks, and accelerate implementation.

On April 17, provincial leaders also held a meeting with Novatek Public Joint Stock Company (Russia), urging the group to survey and research investment in the LNG sector – a strength of the enterprise.

However, the investors ignored the project.

Nguyen Anh Tuan, deputy head of the management board, said, “There are many reasons for the project’s unattractiveness, the main one is investors' concerns about the tight timeline to implement the plant, which requires bringing it into commercial operation before 2030. In addition, the other factors combine the large investment and large bid guarantee amount, and the unpredictable fluctuations in the global economy and geopolitics, causing fuel prices rises."

According to the bidding documents, investors must meet the minimum equity requirement of VND8.62 trillion ($344.8 million). The total value of equity and debt capital that the investor is capable of raising is at least $2.3 billion. The technical prerequisites to be me a plant capacity of 1,500MW, using combined-cycle gas turbine technology with an efficiency of over 58.5 per cent; the main machinery and equipment in the project's technology line must be 100 per cent new; and the commercial operation opening time is 2029-2030.

“The criteria set out in the bidding documents aim solely to select a strong investor capable of implementing the project and meeting the required timeline,” Tuan said.

Located to the south of Nghi Son Port in Thanh Hoa province, if it comes to fruition the scheme will cover 68 hectares, featuring a power plant, warehouse, regasification system, wharf, and a ship anchoring zone.

The five investors previously invited to bid include a joint venture between JERA and Sovico, and a consortium of Korea Southern Power Company, Korea Gas Corporation, Daewoo Engineering & Construction Group, and Anh Phat Construction and Trading Investment.

The three others were Gulf Energy Development, SK E&S Co., Ltd., and a joint venture between PetroVietnam and T&T Group.

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