Work on Laos-Vietnam oil pipeline project awaits approval

Work on Laos-Vietnam oil pipeline project awaits approval

Work on a US$380-million oil pipeline connecting a Vietnamese harbour to
central Khammuan province of Laos is set to begin once the feasibility study
is approved by the Lao government, a senior technical in-charge of the
project has said.

Now, we are waiting approval from the government after the feasibility study
was submitted for consideration, Mr Veth Malavong, a senior technical staff
of Petro Lao Company, told Vientiane Times last week.

Petro Lao Company is a project developer and it is believed the oil pipeline
from Hon La Harbour in Vietnam's Quang Binh province to Thakhaek district of
Khammuan province will be a significant investment project between the two
countries.

According to the feasibility study, the planned pipeline will significantly
reduce cost of oil imports. The price of gasoline in Khammuan province could
be reduced much lower than the current rates. Once the project is fully
operational by 2026, it could import as much as 2.5 billion litres of
refined oil annually, double the amount currently needed by Laos.

Data collected from 22 petroleum companies around the country shows that 1.2
billion litres of oil were imported by Laos in 2015.

We hope to begin the project as soon as possible once the government gives
the green light for the construction. Meanwhile, the Vietnamese side has
already approved the project, Mr Veth said. The plan for the pipeline has
already been approved by the Ministry of Public Works and Transport but the
final approval will have to be given by the government.

Once the Lao government approves the project, we will inform the Vietnamese
side and construction work could then begin, he added.

The project will comprise two phases, with Phase I involving the
construction of the harbour and Hon La Oil Stockpile, which are set to be
completed in 2019. The Hon La Oil Stockpile has been designed to be capable
of storing 50,000 tonnes of oil. Phase II will see the construction of the
pipeline and oil stockpile in Thakhek, which will be able to store 90,000
tonnes of oil. The Hon La Oil Stockpile will then be expanded to store up to
80,000 tonnes of oil under Phase II.

Once Phase I is completed, oil can be imported directly from Singapore to
Hon La Stockpile and then sent to Laos by land, which would result in the
reduction of oil prices as importers would save on transport costs and would
not have to engage middlemen, Mr Veth explained. The project was finalised
during Vietnamese Prime Minister Nguyen Xuan Phuc's official visit to Laos
early this year.

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Link to Original Article:
http://www.vientianetimes.org.la/FreeContent/FreeConten_Work.htm

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com