Decision No. 1755/QD-BCT dated February 26, 2015 of the Ministry of Industry and Trade approving the master plan for development of Vietnam oil pipelines by 2020, with the vision to 2030”

THE MINISTRY OF INDUSTRY AND TRADE

Decision No.1755/QD-BCT dated February 26, 2015 of the Ministry of Industry and Trade approving the master plan for development of Vietnam oil pipelines by 2020, with the vision to 2030”

Pursuant to the Decree No. 95/2012/ND-CP dated November 12, 2012 of the Government defining the functions, tasks, entitlements and organizational structure of the Ministry of Industry and Trade;

Pursuant to the Decree No. 92/2006/ND-CP dated September 7, 2006 of the Government and the Decree No. 04/2008/ND-CP dated January 11, 2008 of the Government on amendments to on the Decree No. 92/2006/ND-CP on formulation, approval and management of master plans for socio-economic development;

At the request of Director of Planning Department,

DECIDES:

Article 1.To approve the“Master plan for development of system of Vietnam oil pipelines by 2020, with the vision to 2030” with the following contents:

1.Viewpoints on development

a) Develop system of oil pipelines in combination with socio-economic development strategy of Vietnam, combine the system of oil production with the system of oil pipeline distribution in order to meet the domestic demands, national reverses and ensure the energy security and facilitate the export.

b) Take full advantage of current facilities; improve the strength of the economic sectors and international cooperation during the development of system of oil pipelines.

c) Ensure the consistency and consolidation of economic development and economical use of land resources and environmental protection, remain politics stable and ensure national defense and security.

2.Development objectives

a) Meeting demands for the transport of oil pipeline from suppliers (oil refineries and central oil depot) to the consumption centers in large quantities and ensuring the safety and efficiency.

b) Streamline the transport of oil pipeline from suppliers to consumption centers in order to reduce transport costs then reduce selling prices and minimize risks to the environment.

c) Take full advantage of technical facilities of the current system of oil pipelines. Combine with ship transport and road transport to organize the distribution among suppliers in order to avoid the disruption of oil pipeline supply between regions and upstream areas.

3.Development orientation

a) The North and the North Central Coast: Central general oil depot and General oil depot of Nghi Son Refinery and Petrochemical complex of Nghi Son Economic Zone in Tinh Gia district of Thanh Hoa province shall be the distribution center in order to construct and develop the system of oil pipelines providing for vicinity regions.

b) The Central Coast: General oil depot of Dung Quat refinery of Dung Quat Economic Zone in Binh Son district, Quang Ngai province shall be the distribution center in order to construct and develop the system of oil pipelines providing for vicinity regions.

c) The South: General oil depot of Long Son refinery in Long Son Island, Vung Tau city of Ba Ria - Vung Tau province shall be the distribution center in order to construct and develop the system of oil pipelines providing for vicinity regions.

4. Development planning

a) By 2020

- The North: Construct, renovate and upgrade oil pipelines with total length of 241 km, in which:

+ Construct about 161 km of new oil pipelines from the oil depot of Nghi Son Refinery and Petrochemical complex in Nghi Son commune, Tinh Gia district of Thanh Hoa province to Ha Nam oil depot in Kim Son commune, Kim Bang district of Ha Nam province;

+ Upgrade about 33 km of oil pipelines (diameter: 150-300 mm) from Ha Nam oil depot in Kim Son commune, Kim Bang district of Ha Nam province to Nam Hanoi oil depot in Nam Phong commune, Phu Xuyen district of Hanoi city, in order to meet the demand for pumping oil to Nam Hanoi oil depot;

+ Construct about 47 km of oil pipelines from Nam Hanoi oil depot in Nam Phong commune, Phu Xuyen district of Hanoi city to transit oil depot (prospective new oil depot in Luong Son district of Hoa Binh province);

+ Continue to renovate and upgrade synchronously the B12 primary oil pipeline.

- The Central Coast: Construct 172 km of new oil pipelines from the oil depots of North Central Coast to Laos, whereby:

+ Construct 60 km of new oil pipelines (diameter 200-250 mm) from Ben Thuy oil depot in Hung Dung, Vinh city of Nghe An province to oil depot (new depot) at Thanh Thuy checkpoint in Thanh Thuy commune, Thanh Chuong district of Nghe An province;

+ Construct 112 km of new oil pipelines (diameter 200-250 mm) from Vung Ang oil depot in Vung Ang economic zone, Ky Anh district of Ha Tinh province to the oil depot (new depot) in Cha Lo checkpoint economic zone, Minh Hoa district of Quang Binh province;

- The Central Coast and the Central Highlands: Construct 115 km of new oil pipelines from Phu Hoa oil depot in Quang Trung ward, Quy Nhon city of Binh Dinh province to Bac Tay Nguyen oil depot in La Tiem commune, Chu Se district of Gia Lai province and transit oil depot (new depot) in Phu Phong town, Son Tay district of Binh Dinh province.

(Refer to Appendix No.1)

- Research on capacity of connection of oil pipeline pipelines from Hon La Harbor in Hon La economic zone, Quang Trach district of Quang Binh province to Cha Lo Checkpoint economic zone in Ninh Hoa district of Quang Binh province.

b) With the vision to 2030

- Construct 52 km of new oil pipelines from Long Son refinery in Long Son commune, Vung Tau city of Ba Ria – Vung Tau province to Nha Be General oil depot in Nha Be district of Ho Chi Minh city (connection with oil depot group in Phuoc Khanh commune, Nhon Trach district of Dong Nai province and head oil depot group in Nha Be district of Ho Chi Minh city).

(Refer to Appendix No.2)

- Research on capacity of connection between pipelines:

+ From Lach Huyen General oil depot of Hai Phong city with B12 pipeline in the Yen Cu area (Dai Yen commune, Ha Long city of Quang Ninh province);

+ From upstream oil depots in the Southeast to consumption centers in the Mekong River Delta;

+ From the Northern Central Highlands to Southern Central Highlands (Gia Lai – Kon Tum – Buon Me Thuot – Dak Lak);

+ Ho Chi Minh city rim;

+ From Long Son refinery in Long Son commune, Vung Tau city of Ba Ria – Vung Tau province to Long Thanh international airport in Long An commune, Long Thanh district of Dong Nai province.

- Research on capacity of connection of North – South oil pipeline and capacity of connection with neighbor countries sharing the same boundary line.

- Research on expansion of B12 system of oil pipelines along Hanoi city rim to Phu Tho and Tuyen Quang province to supply oil pipeline to the Northern midlands and mountainous.

5. Implementationsolutions

a) Solutions pertaining to management and operation

- Check the staff members in charge of oil pipeline transport of enterprises, strictly dissolve weak transport enterprises; private enterprises may only provide road transport services.

- Establish professional pipeline transport corporations which may be in charge of transport with large quantity, earliest time and cost reduction.

- Set up cooperation or joint venture regime among enterprises in the system of production and distribution of oil pipeline to mobilize capital resources, take full advantage of technical facilities in order to invest in the oil pipeline projects.

- Develop industries related to equipment and specialized supplies; construction equipment for oil pipeline to support and supply to oil pipeline projects.

b) Solutions pertaining to investment capital

- Encourage enterprises to attract multiple capital resources to invest in construction of system of oil pipelines as prescribed in regulations in force such as: bank credit, issuance of shares, corporate bonds or listed on the stock market or Official Development Assistance (ODA).

- Support investment projects for oil pipelines having major impact on power security and national defense as prescribed in regulations in force such as: low-interest loans, deferred payment of value added tax in the first few years of the project, the capital tax exemption for research technological innovation.

- Support enterprises investing in oil pipelines in disadvantaged areas in site clearance or incentives pertaining to land rents.

c) Solutions pertaining to land

Formulate incentive policies on lease and borrowing of construction land with reasonable rents to attract investors or support in site clearance and land rent reduction applied to the oil pipelines having major impact on power national defense and security.

d) Solutions pertaining to environment

- Formulate operating procedures for oil pipelines as prescribed in regulations on fire and oil transport.Strictly control the pumping of oil in the pipelines, especially control of pumping discharge pressure.

- Comply with regulations on risk assessment and prevention plans for emergency responses to fire and explosion, leakage, break of oil pipelines. Set up regime for inspection, observation and management of prevention and emergency responses to ensure the safety of the people in the area where the oil pipelines are operated as planned.

- Encourage enterprises to invest in study and application of new solutions to reduce environment pollution.

6. Implementation organization

a) The Ministry of Industry and Trade must announce and direct the implementation and inspection of implementation of the Master plan for development of system of Vietnam oil pipelines by 2020, with the vision to 2030.

b) Ministries, agencies, the People’s Committees of central-affiliated cities and provinces having oil pipelines passing shall cooperate with the Ministry of Industry and Trade within their functions, tasks, power in implementation of tasks and objectives of the Master plan, ensure the uniformity and synchronization with plan for socio-economic development of agencies, local governments and enterprises; enable investors to assess and carry out steps of investment and construction of oil pipelines.

c) Petroleum enterprises managed by the State must cooperate with the Ministry of Industry and Trade within their functions, tasks, powers in formulation of plans for construction of oil pipelines, including:

- Facilitate the cooperation between manufacturers and distributors in agreement on sources of oil transporting by pipelines and investment capital for construction of oil pipelines.

- Formulate detailed construction planning to conclude an agreement on location and land with the People’s Committees of provinces and cities and specialized authorities of Ministries or agencies.

Article 2.This Decision takes effect on the signing date.

Article 3.The Chiefs of the Ministry offices, Directors of Departments: Planning, Finance, Domestic Market, Director of General Department of Power, the People’s Committees of provinces having oil pipelines passing and relevant oil pipeline enterprises shall implement this Decision./.

For the Minister

The Deputy Minister

Do Thang Hai

APPENDIX 1

LIST OF OIL PIPELINE PROJECTS BY 2020
(Issued together with the Decision No. 1755/QD-BCT dated February 26, 2015 of the Minister of Industry and Trade)

APPENDIX 2

LIST OF OIL PIPELINE PROJECTS OF 2020 – 2030 PERIOD
(Issued with the Decision No. 1755/QD-BCT dated February 26, 2015 of the Minister of Industry and Trade)