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Crude oil from Bach Ho field accounts for only 58% of Dung Quat refinery

​A source from Binh Son Refining Petrochemical Company Limited (BSR) said that in 2016, crude oil from Bach Ho field accounts for only 58% of the demand for Dung Quat oil refinery.

​At the beginning of operation in 2009, Dung Quat Oil Refinery with capacity of 6.5 million tons of crude oil per year imported 100% Bach Ho crude oil.

After 3 months of running the refinery, in August 2010, BSR’s engineers successfully processed the first batch of Azeri crude oil which was imported from Azerbaijan, the Mediterranean.

The successful processing of Azeri crude oil has marked the diversification of crude oil supply to Dung Quat oil refinery.

In 2015, BSR successfully built the Sulfur Recovery Plant (SRU), significantly increasing the mixing ratio of various types of crude oil significantly.

Currently, the factory has successfully processed 15 kinds of crude oil from different regions of the world such as Azeri (Azerbaijan), Champion, SLEB (Brunei), Kikeh, Labuan, Miri (Malaysia), Kaji Semoga (Indonesia) NKossa (Congo), Amna (Libya), ESPO (Russia), Dai Hung, Te Giac Trang (White Rhino), Su Tu Den (Black Lion), Chim Sao, Thang Long (Vietnam).

In particular, many types of crude oil are mixed with high rate up to 50-70%.

These crude oil have been supplied to Dung Quat oil refinery under long-term contracts with a total volume of up to 13.6 million tonnes so far, contributing to ensure the volume of crude oil supplied to Dung Quat Oil Refinery Quotas operate at 105 to 107% of designed capacity despite the decrease in Bach Ho crude oil production.

In the next 3-5 years, BSR can be assured of stable development with the current material source.

Upgrade Dung Quat refinery to diversify crude oil sources and increase product quality

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Currently, Binh Son Petroleum Refining Company Limited (BSR) is completing the overall design of the Dung Quat refinery project (the project).

Accordingly, the project will need total investment capital of $ 1.806 billion, of which the loan capital is 30% or $ 1.26 billion.

According to project, Dung Quat Oil Refinery will have additional technology workshops to process higher sulfur crude oil, higher output, such as Murban, ESPO, Arab Light and to process products meeting Euro 5 standards.

It will build one more SPM locating 2km north of the current wharf in order to accommodate vessels with capacity of 300,000 tons.

Thus, the crude oil sources of Dung Quat Oil refinery will be expanded significantly compared to the current.

Once the project accomplished by 2021, the refinery capacity will increase to 8.5 million tons of crude oil per year and the quality of petroleum products confidently meet Euro 5 quality standards.

The project will allow the production of many products, including plastic pellets, asphalt, A97 and A98 petroleum, and other special materials for military and defense purposes.

BSR meets about 30-35 per cent of total demand for petroleum in the country. Although the refinery’s capacity will increase by approximately 30 per cent after the project is finished demand will also rise, so BSR’s supply to the domestic market will stay at approximately 35 per cent.

BSR has been cooperating with Vietnam Oil Corporation (PVOIL) to negotiate with manufacturers and suppliers to sign memorandums of agreement (MOU), framework agreement (FA) and contract Framework (COSA) on the long-term supply of crude oil to the mill by 2040.

According to Mr Tran Ngoc Nguyen, the BSR’s General Director, the cost of crude oil at the Dung Quat Refinery accounts for 90% of the total cost, but factories around the world cost between 80 and 90%.

With a comparative advantage of only 5 – 10%, profits are different.

Thus, optimizing the sources of crude oils, it will bring significant profits to the company, and the cost of petroleum products on the market will be more reasonable.

Minh Chau (quangngai.gov.vn)

 

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