PetroVietnam mothballs ethanol plants due to unprofitable markets
Vietnam’s state-owned oil company PetroVietnam has confirmed that its Dung Quat bioethanol plant has halted its operation due to high production costs making its products uncompetitive in the market.
As petrol prices have been falling in the world market, E5 biofuel cannot compete with RON92, and as a result, the plant has stopped production after a long period of running at moderate level.
Dung Quat Bio-Ethanol, with the designed capacity of 100 million litres of ethanol a year.
Besides Dung Quat, PetroVietnam has also invested in two other biofuel plants, Orient Bio Fuel Company (OBF) and PetroVietnam Biofuels (PVB).
PVB was designed to have capacity of 100,000m3 of ethanol, but its construction stopped in late 2011.
OBF with the capacity of 300,000 litres a day, is located in Binh Phuoc province and after two years of construction, was put into trial operation, but as the biofuel could not be sold, the plant has halted operation and workers have been laid off.
PetroVietnam, when announcing investment in the three plants, stated that developing biofuels was one of the priority objectives of the oil and gas industry development strategy.
Besides the three PetroVietnam-invested biofuel plants, Vietnam has four other plants – Dai Tan Ethanol Plant developed by Dong Xanh, Dai Viet, Dak To, and Tung Lam – all of which are in the same situation.