Mitsubishi and Doosan, together with Vietnamese partners Power Engineering Consulting Joint Stock Co. 2 and Pacific Corporation, have entered into a contract to construct a new coal-fired power plant in southern Vietnam. The contract issued by state-owned Electricity of Vietnam (EVN) is valued at approximately $1.4 billion. EVN will provide about 15 percent of the costs to build the plant. EVN said funding for the remining 85 percent of the project will come from financing agreements with the Export-Import Bank of Korea, Korea Trade Insurance Corp. and Japan Bank for International Cooperation.
The 1,200-megawatt Vin Tan 4 power plant will be composed of two 600 MW units and located in Binh Thuan province, about 150 miles north of Ho Chi Minh City. Construction will begin in the first quarter of 2014 with completion expected by 2017 for the first unit and by 2018 for the second unit.
Electricity demand in Vietnam is expected to see a remarkable increase of more than 10% per annum in the coming years due to rising population and economic growth. Southern Vietnam in particular, the country's largest economic block, faces a critical situation in relation to the current imbalance between existing supply and the increasing demand for electricity. There is therefore urgent need for the development of power generation infrastructure in the region.
Currently, nearly half the country's electricity supply is generated by hydraulic power, but due to weather and other factors, the need for a more stable source of electricity is ever more present. This project, therefore, is expected to play an important role in preventing the shortage of electricity in the area.