Local firms sign petroleum contracts with Dung Quat

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Binh Son Refinery Company, the operator of Dung Quat oil refinery, signed distribution contracts with four state-owned firms on Tuesday.

Petrolimex, PV Oil, Petec and Vinapco committed to buy some 4.7 million cubic meters of the products like A92, A95, diesel and FO for vehicles and planes, according to a joint release issued by the firms.

Petrolimex signed on to consume the largest volume (2 million cubic meters) of the refinery's output.

The Binh Son Company has had a hard time selling its products since Dung Quat began refining petroleum in February 2009.

Local distributors said they signed contracts with foreign suppliers which offered more attractive pricing policies than the country's lone supplier, the Dung Quat Refinery.

The statement claimed that the operator, which took over the plant from PetroVietnam in May, would offer more competitive prices to lure domestic distributors.

The Dung Quat Refinery was designed to turn out six million tons of refined petroleum from 6.5 million tons of crude oil in order to meet 30 to 35 percent of domestic demand.

So far, the facility has produced some 6.21 million tons of refined products.

The plant plans to turn out only 4.6 million tons of petrol next year due to a two month maintenance hiatus, according to the joint statement.

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