Japan-based Idemitsu Kosan, along with its partners Mitsui Chemicals, Kuwait Petroleum International and PetroVietnam, is set to construct $9bn oil refinery in Vietnam.

The Nghi Son Refinery and Petrochemical Complex, which would be built about 200km south of Hanoi in Tinh Gia District of Thanh Hoa Province, will be the second oil refinery in the country.

Idemitsu is building the refinery with a processing capacity of 200,000 barrels per day to meet the growing demand of petroleum products in the domestic market, and have a strategic advantage in growing markets of Southeast Asia.

In order to establish the new refinery, Idemitsu and its partners have set up a company named Nghi Son Refinery and Petrochemical LLC (NSRP) in 2008.

The partners issued through NSRP a letter of intent for the front-end engineering design contract to a construction consortium of
JGC, Chiyoda, Technip Group (France, Malaysia), and South Korea’s SK Engineering & Construction and GS Engineering & Construction.

NSRP is planning to soon launch syndication procedures of a co-financing arrangement with international commercial banks, Export Credit Agencies and Multi-Lateral Agency.

The financial arrangement is expected to close by mid-2013 and the commencement of the engineering, procurement, and construction work by the consortium is planned around the same time.

Mechanical completion of the refinery is expected in 2016, whereas the facility is anticipated to begin commercial operations in 2017.