Sheikh Ahmad said, Together with our partners for the planned refinery and petrochemical complex project, we are also considering launching downstream business focusing on the marketing of fuel products manufactured by our refinery in Vietnam, given that most of its output will be consumed in the country. Asked when the alliance will start fresh business, the Kuwaiti minister said, It might be before completion of construction of the refinery there.
The plant is to be positioned around 180 kilometers south of the capital Hanoi. It can refine up to 200,000 barrels per day. The facilities will be planned to pump 100% Kuwaiti crude supplied by Kuwait Petroleum Corporation (KPC) to high-priced petroleum products such as gasoline and kerosene.
Vietnam has offshore oil reserves but now imports petroleum products.
Kuwait Petroleum International (KPI), a unit of KPC and Idemitsu Kosan Co., Ltd (Idemitsu) evenly own a 35.1% stake in the joint project, with Vietnam Oil and Gas Group (PetroVietnam) and Mitsui & Co., Ltd. putting up 25.1% and 4.7%. The joint venture aims to save about 70% of the construction costs through project financing led by the government-affiliated Japan Bank for International Cooperation (JBIC).
The partaking firms will be liable for the remainder of the funds depending on their percentage of stake acquisition; KPI and Idemitsu are expected to add around $600 million each if JBIC provides some $4.2 billion.
According to Sheikh Ahmad, during brief discussions on the sidelines of an energy conference, Japanese Economy, Trade, and Industry Minister Toshihiro Nikai assured his utmost effort in helping the joint venture secure the construction costs for the refinery, which are expected at $6 billion with a capitalization of $200 million.
Meanwhile, Sheikh Ahmad wanted increased efforts to obtain needed funds in his meeting with Idemitsu President, Akihiko Tenbo.
I also proposed Tenbo to jointly set up a fund serves local community in the area where the complex is located, such as constructing schools, he said.
