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Laos, Vietnam speeding up oil pipeline project

Lao PM Thongloun Sisoulith and his Vietnamese counterpart Nguyen Xuan Phuc agreed to accelerate the project during the former’s visit to Hanoi earlier this month.

Photo Credit: Laotian Times

By Souksakhone Vaenkeo

Vientiane, October 12, 2017

Vientiane Times

Lao authorities are gearing up to realise the planned bonded warehouses and pipeline project from Vietnam’s Hon La port to Laos’ Khammuan province as the countries’ leaders agreed to speed up implementation.

Prime Minister Thongloun Sisoulith and his Vietnamese counterpart Nguyen Xuan Phuc agreed to accelerate the project during the Lao premier’s visit to Hanoi earlier this month.

The leaders agreed to speed up key projects like the Lao National Assembly building – a gift from Vietnam to Laos – the Hanoi-Vientiane expressway, the oil pipeline and warehouses, and several other energy and traffic connectivity projects, Vietnam News reported.

Improvements to the warehouses and pipeline project concept are being made, said a senior technical staff member of Petro Lao Company, one of the project’s key developers, Mr Veth Malavong.

The project, estimated to cost US$380 million, was set to receive 40-40-20 percent investment stakes from Petro Lao Company, Petro Trade Company, and the Lao government respectively.

The developers and relevant government sectors recently met and agreed to make some changes including shortening the construction period and reviewing the amount of oil to be imported in line with domestic demand.

If the construction period is shortened as recommended, the project will be fully completed and operational by 2024 instead of 2026 as originally planned.

“The stakeholders are expected to meet again in the middle of this month or at the end of the month [to finalise the project design],” Mr Veth said.

According to the project’s feasibility study, four main facilities would be developed. They are the Hon La harbour and Hon La Oil stockpile in Vietnam, a 306-km oil pipeline from Hon La to Thakhaek, capital of Khammuan province, and an oil stockpile also to be built in Thakhaek district.

The project will comprise two phases, with Phase I seeing construction of the harbour and Hon La oil stockpile, which would take two years with completion slated for 2020.

The Hon La oil stockpile was designed to store 50,000 tonnes of oil.

Phase II will see construction of an oil pipeline and oil stockpile in Thakhaek, which will be able to store 90,000 tonnes of oil. The Hon La oil stockpile will then be enlarged to store up to 80,000 tonnes of oil under Phase II.

Once operational, the project would reduce oil prices in Laos, according to the feasibility study.

The price of gasoline in Khammuan province could be reduced by as much as 600 kip per litre – from 7,500 kip per litre to 6,900 kip based on the price when the study was conducted.

Meanwhile, diesel prices could be reduced from 6,500 kip to 6,200 kip per litre.


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