The uptick of Vietnam’s coal demand is projected to continue well into 2030, with the need expected to rise to 86.4 million tonnes by 2020 and 256 million tonnes a decade after. Estimates place necessary investment capital for the coal industry by 2030 at 96.6 million Vietnam dong, Hellenic Shipping News reported Jan. 24.
Despite talks of the government pouring funds into exploiting coal in the next five years, former director of the board of Vietnam National Coal - Mineral Industries Holding Corp. Ltd., or Vinacomin’s, Red River Basin Coal Projects Nguyen Thanh Son cautioned that the money would be better spent in maintaining the production of the fuel instead of expanding it, the report said.
Judging from the average coal export price at the ports in Quang Ninh province, which is at $2.90/MMBtu f.o.b., and the import coal import price at $2.60/MMBtu, Son noted that "domestic exploitation is inefficient" since it is priced higher than imports, the report said.
According to the report, coal reserves in Vietnam are nearly zero, if one follows the standard established by the ministry of natural resources and the environment, which is similar to the standards used by the U.S.
Meanwhile, a Jan. 20 report by Nikkei Asian Review noted that after the fallout of Vietnam’s Japanese- and Russian-backed nuclear projects in November 2016, the country is now looking to coal as the answer to its energy needs. The abundance of coal and its relative affordability in Vietnam, a country whose government debt has ballooned to 65% of GDP, has made it a viable alternative to nuclear energy, the report said.
The country currently has around 20 coal power facilities, with the government foreseeing the growth of the tally to 32 in 2020 and 51 in 2030, the report said. In 2016, fossil fuels made up one-third of Vietnam's power and there are plans to hike it up to 45% in 2030.
Japanese and Chinese investors have acknowledged the new business opportunity the country presents in terms of power generation, the report said.
Mitsubishi Corp. said that it plans to build a 1,200 MW coal power plant in Ha Tinh Province in 2021, to be named the Vung Ang No. 2. The company will help manage the facility before handing over its operation to state-run Vietnam Electricity. It also plans to build another plant in Binh Thuan. Meanwhile, Marubeni Corp. is building a coal power plant near Hai Phong and Sumitomo Corp. is constructing a plant in Tra Vinh Province, near Ho Chi Minh City, the report said.
As of Jan. 25, US$1 is equivalent to 22,592.50 Vietnam dong.