Phu Tho ethanol may go bankrupt

Phu Tho ethanol plant may be allowed to go bankrupt

According to the minister, while the Dung Quat and Binh Phuoc bio-ethanol factories are preparing to resume operations, the Phu Tho ethanol factory may go bankrupt due to its unfavourable location and inefficient business model.

The ethanol project in Tam Nong district, Phu Tho province invested by Bio-Petroleum and Petrochemical Joint Stock Company (PVB) is one of these 12 projects. Work on the plant started in 2009 and it was slated to begin operation in 2012. The 50ha project had an initial investment of VND1.7 trillion ($73.9 million), but later, the figure was raised to $2.4 trillion ($104.35 million).

By late 2011, around 80 per cent of the work was completed, including the management building, stores, main production area, waste treatment system, and a number of other facilities. However, since then the plant has been at a standstill.

Two others of the 12 loss-making projects, namely DAP 1 Haiphong fertiliser plant and the complex of Quy Xa iron ore mining and quarrying project and Lao Cai iron and steel plant [the latter two counted as one], have resumed operations and started turning profit.

Besides, five other projects are making efforts to be removed from the list. These include Ha Bac, Ninh Binh, and DAP 2 Lao Cai fertiliser plants, Dung Quat Shipbuilding Industry Co., Ltd., and Dinh Vu polyester fibre factory.

The Thai Nguyen iron and steel plant-phase 2 is still caught up in disputes between the investor Thai Nguyen Iron and Steel JSC and the Chinese contractor China Metallurgical Group Corporation (MCC).

The minister reported that central and local inspection agencies have scrutinised all 12 projects and handed over the files of four to the police for official investigation into wrongdoings. Two of these cases have resulted in prosecution so far.

Vietnam Paper Corporation’s (Vinapaco) Phuong Nam Pulp Mill, also one of the 12 companies, was not mentioned in the minister’s response.