(EnergyAsia, Jan 30 2013, Wednesday) — State PetroVietnam has signed an agreement with Japanese and Kuwaiti companies to jointly build a long-delayed 200,000 b/d refinery in the coastal town of Nghi Son located about 200 km south of Hanoi city.

The US$9 billion plant in Thanh Hoa province will process heavy Kuwaiti crude oil to meet the fuel needs of consumers in Vietnam and neighbouring countries.

PetroVietnam will own a 25.1% stake in the project which was conceived a decade ago while Japan’s Idemitsu Kosan and Kuwait Petroleum International will each hold 35.1%. Japan’s Mitsui Chemicals will own the remaining 4.7% in what will be the country’s second refinery when it starts up in 2017.

Vietnamese Prime Minister Nguyen Tan Dung described the project as an important contributor to the country’s economic and social development.

Vietnam’s first oil refinery at Dung Quat started up in 2009 after it was first proposed in the 1980s. Construction of the 130,000 b/d plant was plagued by cost over-runs and delays.