Vietnam's Second LNG Terminal Ready for Commissioning

Vietnam's Cai Mep LNG terminal is seeking a cargo to initiate commissioning tests, two industry sources said, putting it on track to become the country's second terminal to bring in the fuel.

As it seeks to reduce reliance on coal, Vietnam has ambitious plans to build up LNG import terminals and a fleet of 13 LNG-fired power plants that could account for 15% of the country's total installed power generation capacity by 2030. Sources and analysts, however, say the target is at risk of being missed.

The Cai Mep import terminal is operated by Cai Mep LNG, a joint venture between Singapore-based Atlantic, Gulf and Pacific LNG (AG&P LNG) and Vietnamese petroleum trader Hai Linh Company.

Hai Linh Company Ltd was awarded an import license, said two other sources and according to a copy of the license issued by the Ministry of Industry and Trade dated Aug. 1 and reviewed by Reuters.

Two of the four sources that spoke to Reuters said the cargo sought to commission the Cai Mep terminal will be for delivery in October.

The sources could not be named because they were not authorized to speak publicly.

"Given we have just received the import license, we are now working on accelerating the commissioning and target to complete (it) in the next three months," said AG&P LNG CEO Karthik Sathyamoorthy.

"We will look to lock the commissioning cargo in October for end-October to mid-November delivery."

Hai Linh Company and Vietnam's Ministry of Industry and Trade did not respond to a request for comment.

The Cai Mep LNG terminal is located in Vietnam's southern Ba Ria Vung Tau province, and has the capacity to import 3 million metric tons of LNG a year.

AG&P LNG had last said in May that the terminal was on track to begin commercial operations in September.

Vietnam has so far imported over 300,000 tons of LNG on a spot basis via its first LNG import terminal, the Thi Vai terminal by PetroVietnam Gas.

The cargoes were shipped in mostly to fuel existing gas-fired power plants to meet surging power demand during heatwaves earlier this year.

(Reuters - Reporting by Emily Chow in Singapore and Khanh Vu in Hanoi; editing by Barbara Lewis and Michael Perry)