Vietnam power to be disrupted by gas field maintenance

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Vietnam will halt gas supply for 10 days next month to two power plants with a combined capacity of about a quarter of the country's total due to planned maintenance at the Nam Con Son field, an official at state-owned PetroVietnam said on Thursday.

The company plans to run the Nhon Trach and Phu My power plants by domestically produced diesel during the Sept. 15-24 shutdown, producing up to 3,000 megawatts, depending on demand, said Nguyen Tien Vinh, director of PetroVietnam's power department.

The two plants have combined capacity of 5,000 megawatts. Vietnam Electricity (EVN), the country's power monopoly, has said total generation capacity was about 21,600 megawatts.

Vietnam has suffered a chronic and deepening power shortfall, but in recent months, with consumer prices soaring and gross domestic product growth under pressure due to anti-inflation measures, supply has exceeded demand, state media have quoted the industry and trade ministry as saying.

Two other gas-fired power plants, Ca Mau 1 and 2, will be closed for maintenance at different times in October, said an official with PV Power, the electricity producing arm of PetroVietnam.

Ca Mau 1 would be shut from the start of October until an unspecified date, and Ca Mau 2 would be turned off from mid-October possibly through mid-November, said Vu Huy Quang, general director of PV Power.

"EVN has talked to us about their plan to reduce purchase. The power demand is for sure decreasing as industrial growth is weak. So we take this opportunity to do the maintenance program," said Quang.

Quang said the gas pipeline for the two power plants will be shut down for 14 days in October for maintenance. The PM3-Ca Mau, which is run by PV Gas, supplies natural gas from block B46-Cai Nuoc.

The Nam Con Son pipeline provides gas from block 11.2 and 06.1 to Nhon Trach power plants 1, 2, Hiep Phuoc and Phu My 1, 2.2, 3 and 4, according to PV Gas document.

The Nam Con Son basin covers the Lan Tay and Lan Do gas fields, in which BP Plc sold its stakes to its Russian joint venture TNK-BP late last year. PV Gas has a 51 percent stake in the project.

Rotating power cuts

Total power supply from PV Power in the first eight months of the year totaled is 8.6 billion kilowatt-hours, he said.

EVN will implement rotating power cuts in the southeastern part of the country, areas served by the plants that will be off-line or running under-capacity due to maintenance, a source familiar with the details of a meeting between EVN and the Ministry of Industry and Trade said earlier this month.

Gas is becoming an increasingly important generation fuel in Vietnam, making up 32 percent of the power mix last year. Natural gas has helped produce 36 billion kilowatt hours of electricity a year, or 40 percent of the national output, industry officials have said.

The country is projected to produce 14 billion cubic meters of gas annually by 2015, up 40 percent from last year. The government has approved a plan to build a $1 billion liquefied natural gas terminal in the south-central region and is in talks with Qatargas to supply significant amounts of LNG.

PetroVietnam Power, or PV Power, has been embroiled in a long-running dispute with EVN over payments due for power, which it sells to EVN.

PV Power had said it may be forced to close if EVN does not pay VND10 trillion ($480 million) it owes soon.

In July EVN said it was cutting its purchases from PV Power by 10 percent, putting PV Power in a tight spot because it faces penalties from another PetroVietnam subsidiary, PV Gas, if it fails to buy the contracted amount, state media had reported.

The temporary shutdown of the gas fired plants could defuse that problem.

Vinacomin, the state-run mining group, also runs power plants and sells electricity to EVN. In July, Vinacomin accused EVN of delaying payments and said EVN owed it VND1.6 trillion, of which 70 percent was overdue, the online news site VnExpress reported.

Quang told Reuters the government had started lending money to EVN to make its payments. It was not clear exactly how the money was being lent to the state utility, or how much.

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