State-owned PetroVietnam said it has held talks with several foreign companies keen to invest in the country’s second oil refinery in Nghi Son district.

“There are foreign companies from Japan, Taiwan and the U.S. wanting to jointly invest with PetroVietnam in this project,” said Cao Hoai Duong, director of the project management board for the refinery in Thanh Hoa province.
PetroVietnam officials said they hope to finalise the design and investment details in 2008. The refinery will be built from 2009 and is expected to begin operations from 2013.
Duong didn’t name the foreign companies, but state media said Japan’s Idemitsu Kosan is one of the key candidates for the project.
PetroVietnam officials said they are also considering raising the processing capacity of the planned Nghi Son refinery to 8.4 million metric tons of crude oil a year, or about 170,000 barrel per day, from the current target of 7 million tons a year.
“The proposed change in design will lead to a total cost of $5.25 billion, up from a previous estimate of $3.15 billion,” an official said.
According to the Vietnamese Labour newspaper, Idemitsu plans to form a joint venture with PetroVietnam to build the Nghi Son refinery.
Idemitsu will have a 71 per cent stake in the joint venture and PetroVietnam will own the other 29 per cent. The Japanese company will also help arrange a loan of $3.5 billion for the project.
Currently, Vietnam is building its first $2.5 billion refinery in Dung Quat district in Quang Ngai province.
The refinery will have a processing capacity of 6 million tons a year when it comes on-stream in 2009.
PetroVietnam has a;sp signed a contract awarding exploration and production rights at an offshore oil block to a consortium of foreign companies, an official said.