Gazprom Neft, the oil arm of Russian gas monopoly Gazprom and the country’s fourth largest oil producer, and Vietnam’s state oil firm PetroVietnam have signed aseries ofagreements toextend their collaboration activity, boosting traditional close energy ties between the two countries.
The documents were signed inHanoi, inthe presence ofvisiting Russian Prime Minister Dmitry Medvedev and Vietnam’s Prime Minister Nguyen Tan Dung. Medvedev is in Communist Party-ruled Vietnam on a three-day visit from April 5 to April 7 with talks focusing mostly on energy and trade.
Russia, which is hit from Western sanctions over its involvement the Ukrainian conflict, is seeking to expand its cooperation with Asian countries.
For its part, Vietnam, which is embroiled in disputes with China over its expansive claim to the South China Sea, agreed with Russia on the expansion of cooperation in oil and gas projects in Vietnam’s exclusive economic zone and continental shelf in the East Sea, which is the Vietnamese term for the South China Sea.
Gazprom Neft also said on April 6 it planned to purchase 49% of the operator of Vietnam’s Dung Quat refinery, the country’s sole oil processing facility.
It has also agreed to step up cooperation in the broader energy sector by expanding oil and gas exploration and production in Vietnam with PetroVietnam.
Energy cooperation has long been a feature of the relationship between Hanoi and Moscow, starting with the constructions in Vietnam of hydro power plants in the 1980s, followed by an oil and gas joint venture Vietsovpetro and, most recently, the development of nuclear energy.
Gazprom Neft said it now had exclusive rights to negotiate with PetroVietnam on acquiring 49% of the shares -- the foreign ownership ceiling in a Vietnamese company -- in Binh Son Refining and Petrochemical Co, the refinery operator.
See also: Falling oil prices, sanctions rein in Gazprom Neft plans
Dung Quat refinery has said it would process 8.5 million tonnes ofcrude oila year (171,000 barrels per day) once a projected upgrade is finished by 2022.
Russiais currently helping train Vietnamese staff for the country’s first nuclear power plant, with construction slated to begin in 2020.
Meanwhile, Medvedev said on April 6 that Vietnam is close to agreeing a free trade deal with the Russian-led Eurasian Economic Union (EEU), an economic community which also includes Belarus and Kazakhstan.
He predicted that Russia's annual trade with Vietnam could increase by fourfold to $10 billion over the next five years. Medvedev said a trade agreement between Vietnam and the EEU would help bolster economic ties.
“We have agreed on most contents of the agreement,” Medvedev told a press briefing. “I think this is the factor that would promote bilateral trade.”
For his part, Dung said he hoped the trade pact would be signed in the first half of this year.
http://www.neurope.eu/article/russia-vietnam-seal-energy-deals-close-trade-pact