According to information posted on the website of
Vietnam Oil and Gas Power Corporation
(PV Power – POW), the investor of the
Nhon Trach 3 and 4 Power Plant project
stated that: During the Lunar New Year of the Snake 2024, in order to ensure the set schedule, more than 1,600 experts, engineers, and workers worked tirelessly to construct and install the plant’s equipment. For some runway categories, the contractors even increased night shifts to expedite the progress. Everyone focused intensely on their work with the determination to complete the project according to the schedule.
Mr. Le Ba Quy, Director of the Nhon Trach 3 and 4 Project Management Board, stated that up to now, the completed construction volume has reached over 75%, basically meeting the set schedule. The important items of the project have been almost completed. The Turbine, which is likened to the “heart” of the Plant, has been installed and is currently being accelerated by foreign experts and domestic experts and engineers to install accessories to complete this item.
Ensuring the safety, health, and environment of the project is always organized and closely managed to ensure compliance with regulations. The Nhon Trach 3 Power Plant is expected to be completed and commercially operated in November 2024, and the Nhon Trach 4 Power Plant in May 2025.
Construction site of the Nhon Trach 3 and 4 Power Plant Project – Photo by Nguyen Cuong
Currently, the weather in the South is sunny, which is favorable for construction work on the site. Contractors closely adhere to the objectives of safety, progress, and quality of work. PV Power/Project Management Board closely coordinates and deploys all solutions and options to support contractors in implementing the project. During the Lunar New Year of the Snake 2024, workers in some items of the project only took a day off on the 1st day, and the rest always stayed at the construction site to expedite the project progress.
It is known that the Nhon Trach 3 and 4 Power Plant project is located in Phuoc Khanh commune, Nhon Trach district, Dong Nai province. It is an important national project implemented by POW. The project has a capacity of 1,500 MW, with a total investment of USD 1.4 billion. When operational, the project will supply an additional 9 billion kWh of electricity per year.
This is a national important project with many leading indicators in Vietnam today, such as: The project uses the first and most modern imported LNG fuel in Vietnam at this time. The project uses a 1:1:1 configuration (turbine-boiler-generator) for the first time in the country. It is one of the few gas turbine sets (above 500MW) with the largest gas efficiency (over 60%) in the world. The project was constructed and installed by reputable contractors, namely Vietnam Machinery Installation Corporation (Lilama) – Samsung C&T – Lilama Consortium.
The project has a total investment of USD 1.4 billion, and when operational, it will contribute to promoting the transition to clean energy in Vietnam and achieving the commitment to zero emissions by 2050. In addition, the project has a great significance in ensuring national energy security by supplying about 9 billion kWh/year to the power grid.
Investors and contractors work during Tet to ensure the set schedule – Photo by Project Management Board
However, as this is the first project using LNG fuel in Vietnam, there are still many obstacles to be overcome. Currently, the project is facing some related problems such as the inability to sign a Power Purchase Agreement (PPA), incomplete land leasing for the project, and connection of the Nhon Trach 3 Power Plant project… Among them, the most important issue to be resolved soon is the PPA contract between EVN and PV Power; followed by long-term power purchase commitment (Qc) and determining the LNG power price frame. These are the most important factors for the smooth and effective implementation of the Nhon Trach 3&4 Power Plant project. Because only when these 3 factors are established can PV Power promptly sign a long-term Gas Sales Agreement (GSA) with the most reasonable gas price, stable supply.
Regarding the connection, due to the construction of the Nhon Trach Power Plant project’s transmission line to the national electricity system being delayed (due to urban planning in Nhon Trach and site clearance compensation), PV Power and the parties have reached a consensus to propose a temporary connection plan to the existing power transmission system of Nhon Trach 1 and Nhon Trach 2 Power Plants for testing and capacity relief. This temporary connection plan has been completed, pending completion of related procedures.
Notably, the project is still facing problems related to the unresolved consensus between the Nhon Trach 3 and 4 Power Plant Project Management Board and the land leasing unit, TIN NGHIA Corporation.
PV Power’s leaders and contractors regularly come to the construction site to oversee the schedule and resolve difficulties
Previously, POW had a “top urgent” stamped letter sent to Deputy Prime Minister Tran Hong Ha and relevant agencies reflecting the suspension of construction due to TIN NGHIA – the unit in charge of managing the Ong Keo Industrial Park hindering the construction of the cooling water drainage channel at the intersection with Road 4 of the Ong Keo Industrial Park.
The snag stems from TIN NGHIA’s proposal to apply a usage fee unit price of about USD 100/m2 for one-time payment for the project’s entire life span, including 4 years of construction and 25 years of operation. However, POW believed that the fee level is not legally clear at the moment.
According to feedback, as of February 15, the cooling water drainage channel of the project has not yet been implemented.
”
According to POW, this leads to the risk of the project not being completed on schedule, affecting 16 contractors and subcontractors of the project, as well as 1,858 workers and thousands of equipment on the construction site. It is expected that, in addition to hundreds of billions of VND in fines and compensation for EPC contractors due to delays in the progress, causing losses of about VND 1,000 billion in revenue for the business. Currently, POW is waiting for the opinions of the Government and Dong Nai province, requesting TIN NGHIA Company to suspend activities that obstruct the project investor and contractors during the construction process in order to ensure the project is completed on schedule and contribute to ensuring national energy security.
“- information from the PV Power website.
In addition, the project is also facing other difficulties due to the project not being guaranteed loans by the Government and the Qc of the project has not been committed yet, so the capital arrangement work is currently facing difficulties and taking longer than expected…
To ensure the progress, quality, and effectiveness of the project, PV Power/Project Management Board are coordinating with relevant parties and have made proposals to Ministries and sectors to find solutions to the above-mentioned difficulties and obstacles as soon as possible. In particular, PV Power proposes that the Government and the Ministry of Industry and Trade agree to allow the project to apply a pilot mechanism with the most important content in this mechanism is to apply a minimum long-term Power Output (Qc) from 8-10 years (corresponding to the LNG purchasing contract period) following international practices to ensure economic efficiency for the project and benefits for society.
Once this mechanism is applied, not only will the Nhon Trach 3 and 4 Power Plant project be operated effectively, but it will also be the most important prerequisite for the smooth and effective implementation of subsequent LNG power projects, contributing to the development of green energy and implementing the Government’s commitment at COP26, while ensuring national energy security…
Despite facing many difficulties, especially in the coming high-construction season, PV Power commits to concentrate all resources to implement the project with a sense of responsibility and highest effort to bring the project to the set destination on schedule.
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