Bac Lieu gets US$3 billion from FDI power project

Deputy Prime Minister and Foreign Minister Pham Binh Minh and U.S. Ambassador Kritenbrink shake hands at the opening ceremony of the Indo-Pacific Business Forum in Hanoi City – PHOTO: U.S. CONSULATE IN HCMC

Delta Offshore Energy, Bechtel Corporation, General Electric and McDermott signed a Master Teaming Agreement this morning at the opening ceremony of the Indo Pacific BizForum in Hanoi to bring in U.S. equipment and services worth more than US$3 billion for the development of the Bac Lieu LNG-to-power project in Bac Lieu province to help address the growing clean, reliable and competitive energy needs of Vietnam.

The project will bring in 3,200 MW of power to Bac Lieu Province and Vietnam, can generate over 20 TWh of electricity annually and will have a regasification capacity of up to 6MTPA.

The total project concession will be up to US$50 billion over 25 years and is expected to import up to 3 million tons of LNG a year.

According to the agreement, equipment and engineering services worth US$3 billion will be utilized from Bechtel, General Electric and McDermott, employing the best-in-class American technology and engineering from the United States.

The project is led by Delta Offshore Energy, with cooperation from Bechtel, General Electric and McDermott, along with industry-leading American firms as advisors, including JP Morgan as project finance lead arranger, Hogan Lovells as international counsel, Black & Veatch as technical advisor and Marsh as insurance and risk advisor.

The project is of national importance with public support from Vietnam’s top leaders to ensure energy security for the socio-economic development of Bac Lieu Province, a top shrimp exporting province, as well as the rest of the Mekong Delta of Southern Vietnam, the nation’s rice bowl, which currently faces a power shortage of up to 20%, according to Vietnam’s Ministry of Industry and Trade.

The project is a flagship model for US-Vietnam bilateral relations on trade, investment and energy security and represents a new dawn for private sector-initiated investments in energy infrastructure in Vietnam.