Bechtel will provide front-end engineering and design (FEED) services for Delta Energy Offshore’s proposed LNG-to-power project in southern Vietnam.
Bechtel said today that it has been awarded the deal for the 3,200 MW combined cycle gas turbine (CCGT) power plant in Bac Lieu province about 250 kilometres south of Ho Chi Minh City.
The plant consists of four single shaft units of H class gas turbine technology and will form the energy backbone of the Mekong Delta region, earmarked as a focus area for major economic development, added Bechtel.
Start up for the LNG-to-power development is targeted in 2023 with an initial generating capacity of 750 MW. Further blocks of 750 MW will be added over each of the following three years. Consequently, Singapore-based Delta expects to be importing 2.5 million tonnes per year (t/y) of LNG when the power plant reaches full capacity of 3 GW around 2026.
In parallel with the FEED services for the power plant, Delta is carrying out FEED for the offshore receiving terminal, negotiating the terms of the power purchase agreement with the Vietnam Electricity Authority and implementing site reparation works. Bechtel said it looks forward to carrying out the engineering procurement and construction (EPC) works once FEED is finished.
Norway-based Stena Power & LNG Solutions will provide front-end engineering and design (FEED) services for Delta Energy Offshore’s proposed liquefied natural gas (LNG) import terminal, as reported by Energy Voice in May.
Vietnam supporting LNG-to-power
The Vietnamese government is increasingly supporting LNG-to-power projects backed by private investors as the country faces a significant risk of chronic electricity shortages. Potentially online by 2023, Delta’s development could be Vietnam’s first private LNG-to-power project.
Other private LNG-to-power projects making progress include Energy Capital Vietnam’s 3.2 GW development in Binh Thuan province.
State-backed PetroVietnam Gas is building the nation’s first LNG import terminal in the southern port of Thi Vai, which will have an initial capacity of 1 million t/y and is targeted to start up by late 2022. Capacity could be tripled by 2023 as part of a potential second phase.
More than 10 LNG import projects have been proposed in Vietnam, but Delta’s scheme and Thi Vai are the only proposals realistically expected to come online by around 2023-2024.
One of the key challenges facing projects is the lack of clarity around LNG import regulations and complicated procurement procedures involving various state-owned enterprises. This has slowed the progress of many of the proposed developments.
Privately backed LNG-to-power projects, such as Delta’s, appear to be making progress as the integrated approach avoids conflicts between state-owned buyers and state-owned sellers with differing agendas, timelines, and interests.