LNG Thi Vai Terminal in the southern province of Ba Ria-Vung Tau (Photo: VNA)

The Cai Mep LNG Terminal is currently seeking cargo to begin commissioning tests, putting it on track to become the second of its kind in Vietnam to come into operation, according to a report by Reuters late August.

CEO of AG&P LNG Karthik Sathyamoorthy said his firm received an import licence, and is working hard to accelerate the commissioning process, targeting completion within the next three months.

The company plans to finalise the commissioning of cargo this month for delivery between late October and mid-November, he said.

Earlier in March, the company - a subsidiary of Nebula Energy - acquired a 49% stake in Cai Mep LNG terminal located in the southern province of Ba Ria-Vung Tau.Meanwhile, in June, the US-based LNG company Excelerate Energy signed a memorandum of understanding with Vietnam's ITECO JSC to jointly develop a greenfield LNG import terminal in the northern port city of Hai Phong.

Ramon Wangdi, Vice President for Asia Pacific for the gas distribution company Excelerate Energy said that as one of the fastest-growing economies in Asia, Vietnam is an attractive emerging market for foreign investors.

Wangdi said this growth is driven by a rapid increase in energy demand, where LNG will play a key role over the coming decades.

When Vietnam transitions from carbon-intensive fuels such as coal and oil, to renewables like solar and hydropower, LNG will be crucial in helping the country achieve net zero by 2050, he said.

He added that as a global company, Excelerate is exploring investment opportunities in related infrastructure across Vietnam and the Asia Pacific to support this shift in energy strategy.Vietnam set a goal of expanding its LNG-based power initiative from virtually zero to over 20 GW by 2045.

This ambition will position the nation as a key player in the global LNG industry, Wangdi said.Meanwhile, the Son My LNG Terminal - a joint venture between AES Group and PetroVietnam Gas (PV Gas) - has received approval in principle from the Binh Thuan Provincial People's Committee.

The project is slated for completion in 2027.Adam Sitkoff, Executive Director of the American Chamber of Commerce in Hanoi said that US businesses are excited about opportunities in Vietnam, especially in the LNG infrastructure.

However, to turn this interest into real investments, Vietnam needs to demonstrate to international investors that large-scale infrastructure could be deployed under international banking standards.

He said it is crucial that LNG terminals and all buyers have to commit to progress along the same development timeline to unlock international funding.

Vietnam’s 8th Power Development Plan and bilateral agreements reflect the strong relationship between Vietnam and US in promoting energy cooperation. This cooperation is the foundation for the confidence of the US business community to invest in multi-billion dollar LNG projects in Vietnam.

Major infrastructure investments are required to import LNG, including LNG storage and import facilities.According to FiinGroup, Vietnam has taken the first step in developing LNG infrastructure when PV Gas inaugurated Vietnam's first LNG terminal in late 2023. Among 13 LNG power plants that have been approved in Vietnam with a total capacity of 24 GW, two plants, Nhon Trach III & IV and Hiep Phuoc, are under construction, while the remaining 11 plants are still in the planning stage.

Three of the plants are still looking for potential investors.In addition, several commercial terminals including PV Gas’ Thi Vai LNG Terminal and AG&P’s Cai Mep LNG Terminal, have been put into operation or are under construction. These terminals are for both thermal power plants and local industrial customers.

Anh Nguyen, head of Market Research and Consulting at FiinGroup, said that LNG will be a promising industry in Vietnam in the coming years.

The 8th power development plant focuses on transitioning from traditional energy sources such as coal and hydropower and reducing the proportion of these energy sources in electricity production.

The plan targets LNG to contribute 14.9% to Vietnam’s electricity supply.Meanwhile, the Ministry of Industry and Trade has issued new power purchase agreement guidelines in 2024, removing major barriers to the development of LNG and natural gas infrastructure. These guidelines provide investors and Vietnam Electricity (EVN) with clearer guidance to reach agreements effectively./.