Japanese power generation company JERA, ExxonMobil Hai Phong Energy and Hai Phong People’s Committee have signed a memorandum of understanding (MOU) to work together on a potential integrated LNG power project in northeastern Vietnam's port city of Hai Phong.
The three have agreed to study natural gas market development opportunities, including LNG import terminals and gas-fired power plants.
ExxonMobil has submitted a master plan application with a project concept for consideration and potential inclusion in Vietnam’s National Power Development Plan (PDP). LNG-fueled power in Hai Phong would provide a more environmentally friendly alternative to some coal projects currently proposed in the PDP.
According to local media, the project could be built in two phases, totalling 4.5GW, and cost around US$5 billion.
“Hai Phong is industrializing at a fast pace, with an annual growth rate of over 20%; therefore, our annual power consumption is growing and is expected to double between 2020 and 2030,” says Nguyen Van Tung, chairman of Hai Phong People's Committee. “Hai Phong City is pleased to collaborate with ExxonMobil and JERA to provide a clean energy resource for Vietnam in Hai Phong City.”
Vietnam is viewed as an important country for overseas LNG projects sponsored by Japanese companies. The Hai Phong MOU signing is in line with the goals of the Japan-US Strategic Energy Partnership, including supporting energy access and investments for the sustainable economic development and energy security of Vietnam.
Established in 2015, JERA is an equal joint venture of two major Japanese electric companies, TEPCO Fuel & Power Incorporated and Chubu Electric Power Company. It is the largest thermal power generator in Japan and has one of the largest LNG procurement portfolios in the world. JERA has a global presence in the entire energy supply chain, from LNG upstream projects and fuel procurement to fuel transportation and power generation.
In October JERA announced that it will shut down its most inefficient coal fired power plants in Japan by 2030. It also set a 2050 target to achieve net zero emissions.
The Japanese government itself has a policy to shut less efficient coal-fired power plants, which are likely to include those not designated as super-critical.