Major players in coal import discussions

Three powerful conglomerates, the Vietnam Coal and Mineral Industries Group (Vinacomin), PetroVietnam and Electricity of Vietnam (EVN) are to submit to the Government plans to set up a steering committee in charge of coal import management.

Vietnam will both import and export coal

The three groups said that the coal consumption volume has been increasing sharply in recent years in order to meet increasingly high demands for generating power.

In 2009, Vietnam produced 40 million tones of merchandise coal and consumed 43 million tones. The demand for coal is expected to reach 11.4 million tonnes in 2010 and 63.2 million tones in 2015. The figure is forecast to increase to 196 million tones in 2020. As such, Vinacomin, the coal producer cannot meet such a high demand.

According to Nguyen Anh Tuan, deputy head of the energy Institute, other countries in the world, which have mineral resources that can be used domestically, do not export them.China now only imports coal and does not export. The US is building huge depots to contain imports.As for Vietnam, the country should only export kinds of coal with very high quality which it does not use at this moment and can be sold at the prices double that of normal coal.

Importing coal for domestic consumption is being seen as the solution.

It is expected that by 2012, Vinacomin alone will lack 8.2 million tones of coal for power projects, while the figure will be 12.8 million tones by 2015. The volume of coal to be imported for thermopower plants in the south would be some 28 million tones by 2015 and 66 million tones by 2020.

The three, however, all believe that Vietnam needs to keep exporting coal. They said that Vietnam should export the kind of coal it still does not use instead of saving it for the future.

Difficulties ahead

Vietnam will turn from a coal exporter (anthracite coal) into a coal importer in the near future (fat coal and bitum coal).

Meanwhile, most Asian countries have set up ambitious plans to develop coal-run thermopower plants. As such, it is clear that demand for coal will be increasing in the regional market.

According to the three, Vietnam can import coal from Indonesia and Australia. However, it will be difficult for Vietnam to negotiate with the exporters on purchasing coal in large volumes, especially when the exporters are selling coal to Japan, South Korea and China.

In order to have stable coal supply, Vietnam has to purchase the right to mine or obtain stakes in foreign mines. Meanwhile, there is no legal framework on how to carry out the work.

According to Tran Xuan Hoa, general director of Vinacomin, Vietnam will have to import coal in large quantities from 2015. By 2020, Vietnam will have to import 100 million tones of coal and it will have to spend a big sum of foreign currencies, if considering that the current coal price is 120 dollar per tonne.

Hoa stressed that Vietnam has been slow in making investment in foreign coal mines. He said Vinacomin has urged the Government and relevant ministries to take drastic measures to pave the way for this.

“I think that it is quite a normal to import and export coal. Other countries are still importing coal while keeping exporting coal. They sell high quality products and import cheaper products. Power plants have been advised not to use anthracite coal to make power, because this is a high quality coal which should be used in metallurgy and chemical industry,” he said.

VietNamNet/TP

Tags: Vietnam Coal, Vietnam Coal Exports, Vietnam Coal imports