On January 24, 2024 PV Power sent document No. 170/DLDK-DTXD to relevant authorities, in which it asked them to lift barriers that the 1,500MW Nhon Trach 3 and 4 Power Plant project in southern Dong Nai province is currently encountering.
Work on the Nhon Trach 3 and 4 Power Plant project, which has a total estimated investment of US$1.4 billion, commenced in November, 2021, at Ong Keo Industrial Park (IZ) in Nhon Trach district in southern Dong Nai province. This is the nation’s first LNG power plant, which is scheduled to begin operation by the end of 2024 or early 2025. However, this project is currently experiencing a variety of difficulties and impediments that ultimately threaten to hinder the pace of construction and operation.
In an interview given with the media, Nguyen Duy Giang, deputy general director of PV Power, said that the Nhon Trach 3 and 4 Power Plant project is one of the important national projects. At present 80% of the job is finished, but there remains problems with the land transfer at the intersection of Route 4.
Photo: Construction site of Nhon Trach 3 and 4 Power Plant project
Ong Keo Industrial Park in Nhon Trach district of Dong Nai province is managed and leased by Tin Nghia Corporation. “As there is currently a possibility of schedule delays due to the management unit's refusal to carry out the cooling water discharge channel, we have urgently written a document to the government reporting the situation and requesting a solution,” Mr Giang said.
According to document No. 170/DLDK-DTXD, construction work was postponed as Tin Nghia, the industrial park management unit, had not consented to build the cooling water discharge channel at the Ong Keo Industrial Park's intersection with Road No. 4.
The issue is part of the industrial park management unit's idea to impose an infrastructure usage tax of roughly US$100/m2 as a one-time payment method for the four years of construction and the 25 years of project operation. PV Power, meanwhile, thinks the aforementioned charge lacks a strong legal basis.
PV Power states that this puts the project at risk of not being finished on time, which in turn might impact 16 contractors and subcontractors with 1,858 workers and thousands of pieces of machinery and equipment at the construction site. It is estimated that PV Power will lose roughly VND1 trillion in revenue from gas offtake for LNG providers, in addition to hundreds of billions of VND in fines and compensation for EPC contractors caused by schedule delays.
PV Power argues that building hold-ups might jeopardise national energy security and delay the addition of extra electricity to the national grid. The Government, relevant ministries, Dong Nai provincial People’s Committee, Nhon Trach District People’s Committee and the Dong Nai Industrial Zones Management Board must therefore all work together to find a solution to this.
Tran Trung Tuan, general director of Tin Nghia Corporation, responded to the media by saying that PV Power and Tin Nghia Corporation leaders recently held a working session. Here, the parties were unanimous that once PV Power received the findings from the consulting unit in order to evaluate the industrial park infrastructure rental pricing, meaning there would be a basis to reach a consensus on the infrastructure rental price with Tin Nghia Corporation by March 15.
As of right now, PV Power is still awaiting feedback from the Government and Dong Nai province. This will allow the contractors and investors to move on with construction while also maintaining the project’s timeliness, safety, and energy security.
The cooling water outflow channel is one part of the project's critical path. Construction suspension means there is a significant risk that the project won't be finished on time, which would in turn impact the contractors, investors, and thousands of workers, as well as the equipment at the construction site. In addition, it is anticipated that the building suspension mentioned above will incur large costs, which could in turn be detrimental to PV Power.
