17-8-2023 (HANOI) An official document signed by Kuwait’s oil minister, Saad al-Barrak, and seen by Reuters on Wednesday revealed that Vietnam’s Nghi Son Refinery and Petrochemical complex, in which Kuwait Petroleum International (KPI) holds a stake, could suffer a significant loss of $1 billion this year. The projected loss is attributed to price volatility, rising interest payments for loans, and a two-month maintenance shutdown.
The document was a written response from Barrak to a Kuwaiti parliamentarian’s inquiry on the matter, shedding light on the financial challenges faced by the refinery.
Nghi Son Refinery and Petrochemical, Vietnam’s largest oil refinery, has a 35.1% ownership stake held by Japan’s Idemitsu Kosan Co, another 35.1% stake owned by Kuwait Petroleum, 25.1% owned by Vietnam’s state oil firm PetroVietnam, and a 4.7% stake held by Mitsui Chemicals Inc.
Neither PetroVietnam nor KPI were available for immediate comments outside of office hours.
Barrak stated in the letter, “It is currently difficult to determine a timeframe for profitability,” emphasizing that ongoing discussions were being held among the partners to devise short-term and long-term measures to enhance performance.
Earlier this month, Idemitsu, Japan’s second-largest oil refiner, acknowledged that Nghi Son had achieved profitability in terms of operating earnings but not in net earnings. They further disclosed that discussions were underway among the refinery’s sponsors to improve its overall profitability.
The Nghi Son Refinery and Petrochemical Complex, with a total investment of $9 billion, is slated to commence scheduled maintenance from the end of August, lasting approximately 50 days.
