Specialised policies vital for energy future

Vietnam is moving to anchor its energy future, but the scale of funding required is prompting investors to scrutinise whether policy incentives can adequately offset long-term risks.

- By Nguyen Thu

The scale of projects must be weighed against execution risks and other uncertainties

The government last week signalled a decisive step towards reshaping the country's energy architecture, endorsing in principle a National Assembly resolution to pilot mechanisms for the development of a national refining and energy centre at Dung Quat Economic Zone in Quang Ngai province.

Dang Hai Anh, deputy director general of the Department of Oil, Gas, and Coal under the Ministry of Industry and Trade, said at a government session last week reviewing the proposal that it must be considered within the broader context of national energy security.

"Vietnam's demand for electricity and petroleum products continues to rise sharply. The centre will help enhance domestic capacity, reduce reliance on imports, and support new energy development such as green hydrogen and ammonia," he said.

Vietnam's rapid economic expansion continues to drive strong growth in electricity consumption and petroleum demand. However, domestic refining capacity, anchored by the Dung Quat and Nghi Son refineries, currently meets only around 60-70 per cent of total demand, leaving the remainder subject to import volatility.

The proposed hub aims to address this structural gap by building an integrated ecosystem spanning refining, petrochemicals, liquefied natural gas, offshore wind, and emerging fuels such as green hydrogen and ammonia. At its core, the existing Dung Quat refinery, operated by Binh Son Refining and Petrochemical, will act as the anchor asset, connected to upstream gas projects and supported by port and logistics infrastructure.