Dung Quat oil refinery, Vietnam’s sole such facility, will process 8.5 million tonnes (171,000 barrels per day) of crude oil a year after finishing its upgrade project by 2022, instead of 10 million tonnes, an official at the operating firm said.

“Our consultant has prepared several options and this is the optimal plan,” said spokesman Pham Minh Nghia of the Binh Son Refining and Petrochemical Co, the refinery operator which is a subsidiary of state oil and gas group Petrovietnam.

He gave no specific reasons for the capacity scale-down. The project aimed at upgrading the refinery’s current annual capacity of 6.5 million tonnes requires $1.82 billion in investment and is slated to be completed in the third quarter of 2021, Binh Son said last week.

Crude oil feed to Dung Quat refinery, located in the central province of Quang Ngai, mostly comes from the ageing Bach Ho (White Tiger), Vietnam’s main oil field, the output of which has been decreasing.

Vietnam’s crude oil production in the first 11 months of 2014 edged up 1.7 per cent from a year ago to 14.1 million tonnes, based on government data, with output being boosted mainly thanks to overseas production.

After the upgrade, the refinery will be able to take more types of foreign crude oil, Nghia said without elaborating. In November 2013 Russian firm Gazprom signed a deal with Petrovietnam on investment in the $3 billion Dung Quat refinery.

Petrovietnam would provide 30 per cent of the required $18.2 billion investment for the upgrade project, while the rest would come from loans, Binh Son company said.