Block B gas field development project obtains $832 million in Japanese loans

On July5, JBIC signed loan agreements with Mitsui Oil Exploration Co. Ltd (MOECO) Vietnam Petroleum Co., Ltd., MOECO Southwest Vietnam Petroleum Co., Ltd., and MOECO Southwest Vietnam Pipeline B.V., amounting approximately $167 million, approximately $161 million, and approximately $87 million, respectively.

The loans are co-financed with private financial institutions, bringing the total co-financing amounts to $335 million, $322 million, and $175 million, respectively.

The loans are intended to provide the necessary funds for MOECO to develop the Block B gas field located off the southwest coast of Vietnam and build pipelines to transport fuel gas to thermal power plants in the southwest area of the country, by cooperating with its business partners, Vietnam Oil and Gas Group and PTT Exploration and Production Public Co., Ltd. of Thailand.

Natural gas, which produces less greenhouse gases than other fossil fuels, is attracting attention as a source of energy during the energy transition towards the realisation of a decarbonised society and carbon neutrality.

The Vietnamese government announced its goal to achieve carbon neutrality by 2050 and formulated the Power Development Plan VIII in May 2023. The PDP8 aims to reduce the proportion of coal used for power generation and to use domestic gas and liquefied natural gas as power sources in the transition period.

The project, with the participation of MOECO, which has achievements in and knowledge of gas field development, covers the whole development process from the development of domestic gas production to the establishment of pipelines that connect the gas field and the power plants.

The loans will not only support the resources development by a Japanese company, but will also contribute towards the energy transition in Vietnam.

In January 2022, the Japanese government proposed the concept of Asia Zero Emissions Community (AZEC), a framework to provide support and cooperation for the efforts for energy transition by Asian countries by leveraging the strengths of Japanese companies, such as technology and know-how.

Vietnam is an important partner country in the AZEC framework and the loans provided by JBIC are in line with the policy of the Japanese government.

JBIC will continue to financially support the overseas resources development by Japanese companies and the global energy transition.

Prime Minister Pham Minh Chinh receives JBIC Governor Prime Minister Pham Minh Chinh described Japan as a leading important economic partner of Vietnam during a reception in Hanoi on September 14 for Governor of the Japan Bank for International Cooperation (JBIC) Hayashi Nobumitsu.

JBIC pledges aid for Hanoi’s environment, infrastructure The Japan Bank for International Cooperation (JBIC) pledges finance to Hanoi in the fields of environment and transport infrastructure development in the near future.

Japan's Mitsui announces gas field development plans Mitsui & Co., Ltd. (Mitsui), through its wholly owned subsidiary Mitsui Oil Exploration Co., Ltd. (MOECO), has made a final decision and concluded related contracts with its partners regarding an upstream gas field and a pipeline linking it to a gas-fired thermal power plant.