STATE-OWNED coal producer Vinacomin plans to further reduce coal exports this year owing to increased domestic demand. The enterprise plans to produce 38 million tonnes of coal in 2015 with 35 million tonnes to be sold domestically with the remainder, representing 8% of output, to be exported.

Last year the company sold 29.6 million tonnes domestically and exported 5.94 million tonnes. The decrease in exports has been forecast as Vietnam is gradually reducing exports to save coal for domestic consumption.

Vietnam’s General Statistics Office says coal exports in the first nine months of 2014 fell by 35.19% in quantity, or 3200 tonnes, and 33.2% in export turnover ($216.1 million) in comparison with the same period in 2013.

Experts have predicted that Vietnam will begin requiring imported coal for its thermo power plants from 2015, when at least one-third of coal-run power plants would have to use imports. Anticipating the domestic shortage, state-owned enterprises have been seeking alternative foreign sources.

Electricity of Vietnam (EVN) deputy general director Dinh Quang Tri says it is now a buyers’ market. EVN owns most of the power plants in Vietnam. He says as China has shut down many power plants using outdated technologies, supply has become abundant, especially from Australia and Indonesia. He says coal importers now have many choices while the coal price has decreased significantly.

Three of EVN’s power plants will operate with imported coal, including the expanded Duyen Hai 3 plant (600 MW), Vinh Tan 4 (1200 MW) and Duyen Hai 3 (1200 MW). It is estimated that a 1200 MW plant would annually need 4 million tonnes of coal, which means EVN would need 10 million tonnes of coal imports.

PetroVietnam also said it can find coal supply sources without support from Vinacomin. The oil and gas group has reportedly signed a contract with an Australian company to import 3 million tonnes of coal a year. This would be enough to run three out of the five thermo power plants it has.

Meanwhile, Vinacomin, assigned by the Vietnamese government as the major coal importer for domestic distribution, has signed memoranda of understanding and contracts with various partners to annually import 20 million tonnes of coal.

Resource Center Whitepapers, Videos, Case Studies