The Ultimate Powerhouse: Vietnam’s $2.4 Billion Mega Power Plant Project Attracts the Big 5 Investors

This project is the Nghi Son LNG Thermal Power Plant located in the Nghi Son Economic Zone, Thanh Hoa Province.

Specifically, the project involves the construction of a 1,500MW LNG-fired power plant, an LNG import terminal, a 1km-long wave-breaker, and auxiliary infrastructure to serve the LNG import terminal. This includes an onshore LNG storage and regasification facility with a capacity of approximately 230,000m3, a regasification plant with a capacity of approximately 1.2 million tons/year, and technical infrastructure such as a gas pipeline from the regasification plant to the LNG power plant, with a capacity of approximately 1.2 million tons/year.

The project is expected to cover an area of approximately 68.2 hectares, with a total investment of VND 58,026 billion (equivalent to more than USD 2.4 billion at the exchange rate at the time of the project announcement). The construction site is located in the southern area of Nghi Son Port, Hai Ha commune, Nghi Son town, Thanh Hoa province. The project is expected to be commercially operational by 2030 and will have a lifespan of 50 years.

5 Major Investors Interested in the USD 2.4 Billion Project

According to the Management Board of Nghi Son Economic Zone and Industrial Zones of Thanh Hoa province, on November 14, 2023, the board received a project proposal from a consortium of investors, including JERA Co., Inc. and Sovico Group Joint Stock Company. By November 29, 2023, the board had received additional eligible applications from other investors.

As of December 1, 2023, the identities of the five eligible investors were disclosed, including:

Firstly, the consortium of JERA Co. Inc. and Sovico Group Joint Stock Company;

Secondly, the consortium of Korea Southern Power Co., Ltd. (KOSPO), Korea Gas Corporation (KOGAS), Daewoo Engineering & Construction Co., Ltd. (Daewoo E&C), and Anh Phat Investment Construction and Trading Joint Stock Company (APT);

Thirdly, Gulf Energy Development Public Company Limited (Thailand);

Fourthly, SK Group (South Korea)

And finally, the consortium of Vietnam Petroleum Power Corporation (PV Power) and T&T Group Joint Stock Company.

On July 30, the invitation for bids was sent to the shortlisted investors. The bidding process is expected to close/open on September 30, 2024.

According to Báo Đấu thầu, Mr. Nguyen Anh Tuan, Vice Chairman of the Management Board of Nghi Son Economic Zone and Industrial Zones of Thanh Hoa province, stated: “The form of investor selection for this project is international restricted bidding, with a one-stage, one-envelope method, and the shortlist of five investors has been approved.”

The representative of the Management Board further emphasized that all five shortlisted investors possess substantial capabilities and a strong interest in the Nghi Son LNG Thermal Power Plant project. Therefore, it is crucial for the investors to demonstrate their true capabilities through well-prepared bids to be considered for the project.

As the Nghi Son LNG Thermal Power Plant project is a significant national project, the bidding process is designed to be stringent to ensure the selection of a truly capable contractor. Specifically, the bidding requirements include a bid security amount of VND 580.26 billion or USD 24.53 million, with a bid security validity period of 180 days from the bid closing date.

Regarding the investment and business plan, as well as the effectiveness of investing in the industry, sector, and locality, the bidding documents clearly state that the power plant must adhere to the latest international standards and specifications. Bids that do not meet this condition will be disqualified. Other mandatory conditions include a power plant capacity of 1,500 MW, the use of combined-cycle gas turbine technology with an efficiency of more than 58.5% (ISO conditions) in accordance with Decision No. 14/2023/QD-TTg on the issuance of a list of means and equipment that consume a lot of energy and are to be eliminated, and the prohibition of constructing new power plant units with low efficiency…

In terms of evaluating the capacity and experience of the investors, the bidding documents stipulate that the minimum equity capital that the investor must arrange is VND 8,704 billion (equivalent to USD 368 million). The total value of the investor’s equity capital and loans that can be mobilized must be at least VND 58,026 billion, equivalent to USD 2.453 billion. Accordingly, investors with a capital value equal to or above this level will receive the maximum score.

Regarding experience in similar projects, the bidding documents require that the number of projects in which the investor or consortium members have participated as equity investors is one to meet the minimum score (75/150 points). Additionally, investors who have completed three or more similar projects will receive the maximum score.

Moreover, investors must truthfully declare their history of disputes and complaints regarding projects that they have implemented or are implementing (using Form No. 12 in Chapter IV – Bidding Forms) to be considered for the project.