LILAMA signed the EPC contract for Nhon Trach 3&4 Power Plants Project
On Monday afternoon of March 14th, 2022, PetroVietnam Power Corporation (PV Power) and the Consortium of Samsung C&T Corporation-Lilama Corporation held a signing ceremony of EPC contract for the Nhon Trach 3 and Nhon Trach 4 Power Plant Project (Nhon Trach 3&4 Project) and other relevant agreements.
Representatives of PV Power, Samsung C&T and Lilama leaders signs the Nhon Trach 3&4 EPC contract
The Nhon Trach 3&4 Project is an important one in the National Power Development Plan VII that the Government had assigned PV Power to be the investor. The project is located in Nhon Trach commune, Dong Nai province has a capacity of 1,500MW with a total investment of USD1,4 billion. This is also the first thermal plant project in Vietnam using LNG (liquified natural gas) as the main fuel for electric generating, making a contribution into realizing the commitment by the Prime Minister on carbondioxide reduction called “Net-zero omissions” in the 26th conference of the parties (26th COP) for the United Nations Framework Convention on Climate Change (UNFCCC).
The EPC contract signed between PV Power and the Consortium of Samsung C&T - Lilama is the most important part determining the success and efficiency of the whole project. Its total value is over USD940 million (with domestic manufacturing accounting for 39%), in which the main equipment supplied by General Electric (GE) includes gas-turbine, steam turbine, generator, heat recovery boiler and distributed control system (DSC), especially the application of gas turbine model H - the world newest technology generation for combined cycle power plant at the present. Moreover, the Consortium performing EPC work for Nhon Trach 3&4 Porject is the one with excellent capability and rich in experience aiming at promoting internal forces as well as having a domestic favour while taking advantage of advanced technology from the international contractor.
Addressing the speech at the ceremony, the Deputy Minister of Construction Le Quang Hung congratulated PetroVietnam and the involving signing parties who have successfully fulfilled the initial step for the project. Mr. Hung also expressed his belief in the capability and experiences of both the Owner and EPC contractors which shall implement and complete construction for the Nhon Trach 3&4 project upon the requirements on schedule and quality as well as putting it into operation on time, making a contribution in the energy security of the country.
Also at the ceremony, the Head of Agreement (HOA) on long-term maintenance (LTMA) of the Nhon Trach 3& Nhon Trach 4 Thermal Power Plant was signed between PV Power and GE, which would be a premise for the parties to negotiate and sign an LTMA for both projects.
During the past, PV Power carried out the capital arrangement, and so far, the Owner confirmed to ensure adequate funds for the Project, in which equity accounts for 25% and loans is 75% including ECA loan, foreign commercial loans and domestic loans equivalent to USD 600 million, USD 300 million and VND4,000 billion respectively.
In addition, PV Power signed an Extension of Letter of Authorization for a consortium of Citibank (USA) & ING (Neitherlands) to coordinate the arrangement of an ECA loan for Nhon Trach 3&4 Projects in order to make these loans a reality. At the same time, PV Power and SMBC (Japan) signed a mandate letter for a USD200 million loan to finance the PV Power’s investment projects.
The Nhon Trach 3&4 Project is expected to put into operation in 2024 - 2025 and stably supply about 9 billion kWh per year to the national electricity network which shall contribute to promote clean energy transition in Vietnam, increasing tax revenue by thousands of billions dong per year; while creating jobs for thousands of workers during the construction as well as in operation. The Nhon Trach 3&4 Project will start a new chapter in the formation and development of LNG-project chains in Vietnam.
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