BSR Prepared to Sign EPC Contract for Dung Quat Oil Refinery Expansion Project
Vietnam is entering a crucial development phase in its oil refining industry as the Vietnam Oil and Gas Group (BSR), a subsidiary of Petrovietnam, completes the selection of the EPC (Engineering, Procurement, and Construction) contractor for the Dung Quat Oil Refinery Expansion Project. This significant event is scheduled to take place on July 9, 2026, marking a new milestone in Vietnam's oil and gas sector development strategy.
Details on the National Key Project
The Dung Quat Oil Refinery Expansion Project is considered one of Vietnam's most significant industrial projects, aiming to enhance the capacity and operational efficiency of the country's only existing oil refinery. The project not only meets the growing domestic demand for refined petroleum products but also targets export objectives, contributing to economic growth and establishing Vietnam's position in the regional oil refining industry map.
The selection of the EPC contractor represents a critical milestone in the project implementation process, following extensive preparation phases. The contract signing with the EPC contractor will usher in the project execution phase, which is expected to span several years.
Project Overview
| Parameter | Details |
|---|---|
| Project Name | Dung Quat Oil Refinery Expansion Project |
| Investor | Vietnam Oil and Gas Group (BSR) |
| Managing Entity | Vietnam Oil and Gas Group (Petrovietnam) |
| EPC Contract Signing Date | July 9, 2026 |
| Location | Binh Dinh Province |
Strategic Significance of the Project
The Dung Quat Oil Refinery Expansion Project holds strategic importance for Vietnam's energy security and economic development. Currently, Vietnam heavily relies on imported petroleum products, accounting for approximately 30-40% of domestic consumption demand. The refinery expansion and upgrade will help:
- Increase the current refining capacity from 6.5 million tons/year to approximately 10 million tons/year
- Achieve self-sufficiency in petroleum product supply, reducing import dependency
- Improve product quality to meet Euro 5 standards
- Create thousands of direct and indirect jobs
- Attract high-tech investors and technologies to Vietnam
- Contribute to local and national economic growth
Economic and Social Impact
According to economic experts, upon completion, the project will significantly contribute to the state budget through various taxes and fees. The Dung Quat Oil Refinery, after upgrading, is expected to contribute approximately 15-20% of the total oil and gas sector's tax revenues to the state budget.
From a social perspective, the project will foster a strong industrial supporting ecosystem around the refinery area, thereby promoting economic and social development in Central Vietnam provinces, particularly Binh Dinh and neighboring provinces.
Introduction to BSR and Petrovietnam
Vietnam Oil and Gas Group (BSR) is a subsidiary of the Vietnam Oil and Gas Group (Petrovietnam), established in 2007. BSR operates the Dung Quat Oil Refinery, the most modern oil refinery in Southeast Asia at the time of its operation.
The Dung Quat Oil Refinery has a capacity of 6.5 million tons/year, with total investment capital of approximately $2.1 billion. The refinery commenced operations in 2009 and has become the cornerstone of Vietnam's oil refining industry.
Vietnam Oil and Gas Group (Petrovietnam) is Vietnam's leading state-owned economic conglomerate, operating in oil and gas exploration and production, oil refining, power generation, liquefied petroleum gas (LPG) production, petroleum product trading, oil and gas technical services, and other fields.
BSR's Development Strategy
In the context of significant global energy market transformation, BSR has developed a long-term development strategy, with the Dung Quat Oil Refinery Expansion Project as its centerpiece. This strategy includes:
- Enhancing production capacity and efficiency
- Investing in green technology to reduce emissions
- Developing value-added products
- Expanding export markets
- Digital transformation in management and operations
Future Vision for Vietnam's Oil Refining Industry
The Dung Quat Oil Refinery Expansion Project is not only a necessary step to meet domestic energy demand but also an opportunity for Vietnam to assert its position in the regional and international oil refining industry.
According to plans, after completing this project, BSR will continue to research other oil refining projects at different locations such as Long Son (Ba Ria - Vung Tau) to develop an oil refining industry chain across the country, aiming for complete self-sufficiency in petroleum supply and deeper participation in the global energy value chain.
Concurrently, Vietnam's oil refining industry is also preparing for the global energy transition, focusing on developing premium petrochemical products and renewable energy solutions to ensure sustainable development in the future.
Conclusion
BSR's preparation to sign the EPC contract for the Dung Quat Oil Refinery Expansion Project on July 9, 2026, marks a significant step in Vietnam's oil refining industry development strategy. The project will not only bring substantial economic benefits but also contribute to national energy security and enhance Vietnam's position on the international stage.
In the context of the global economy facing numerous challenges, this project demonstrates Vietnam's strong determination to develop a sustainable energy industry while creating a solid foundation for socio-economic development in the coming decades.