Projects

Nam Con Son 2 Gas Pipeline

The Nam Con Son 2 gas pipeline involves the construction of a 325km offshore gas pipeline, approximately 39km of onshore gas pipelines and a 25km onshore liquid pipeline to recover and transport gas from gas fields located within Hai Thach, Moc Tinh (blocks 05.2, 05.3), Thien Ung, Mang Cau (block 04.3), block 04.1 in the Nam Con Son (NCS) and Cuu Long Basin, offshore Vietnam, for onshore processing.

Project Type

Gas transfer pipeline

Location

Nam Con Son and Cuu Long basin, offshore Vietnam

Owner

Vietnam Oil and Gas Group Petrovietnam

Construction Started

2014

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The Nam Con Son 2 gas pipeline involves the construction of a 325km offshore gas pipeline, approximately 39km of onshore gas pipelines and a 25km onshore liquid pipeline to recover and transport gas from gas fields located within Hai Thach, Moc Tinh (blocks 05.2, 05.3), Thien Ung, Mang Cau (block 04.3), block 04.1 in the Nam Con Son (NCS) and Cuu Long Basin, offshore Vietnam, for onshore processing.

The pipeline is also designed to transport imported gas from other ASEAN countries to meet the demands from south-eastern and southern Vietnam. The total capacity of the Nam Con Son 2 gas pipeline is 18.4 million cubic metres of gas and 1,320t of condensate per day.

Owned by Vietnam Oil and Gas Group Petrovietnam, this project is being developed in two phases. The first phase of the project came online in 2015, while the second phase is expected to be completed by 2022.

Blocks 05.2 and 05.3 were developed jointly by Vietnam Oil and Gas Group Petrovietnam (51%) and Gazprom International (49%). Production from these blocks started in 2013 while their output is supplied to consumers via the Nam Con Son-1 Pipeline in South Vietnam.

Onshore sections of the pipeline run parallel to the existing Nam Con Son-1 gas pipeline, jointly owned by Rosneft (32.7%), Perenco (16.3%) and PV Gas, which is a part of Vietnam Oil and Gas Group Petrovietnam, (51%).

Nam Con Son 2 pipeline details

The pipeline is designed to transport and process approximately 20 million standard cubic metres per day (MMSCMD) of gas. The 325km-long offshore section starts from the Hai Thach wellhead platform (WHP), passes through the Thien Ung field central processing platform (CPP), extends further to BT-7 Platform at Bach Ho field and culminates at a landfall point in Long Hai.

“The pipeline is designed to transport and process approximately 20 million standard cubic metres a day (MMSCMD) of gas.”

Phase I involved the installation of an approximately 151.35km-long and 26in-diameter offshore pipeline originating from the Thien Ung CPF and ending at the Bach Ho pipeline tie-in point. The pipeline connects with the Bach Ho rig (BK4A) in the process and transfers gas from both the Thien Ung and Dai Hung fields to the landfall facility.

Phase II of the project involves the development of the pipeline from Bach Ho oil field to onshore Phu My gas processing plant.

The onshore element of the project includes a 300m gas pipeline from the landfall point to a new landfall station at Long Hai; a 9km gas pipeline from the landfall station to the new gas processing plant 2 (GPP2) at Dinh Co; a 30km-long and 30in-diameter gas pipeline from Dinh Co GPP2 to Phu My Gas Distribution Centre (GDC); a new line block valve (LBV) station with cold vent adjacent to LBV Phuoc Hoa station and two 25m liquid product pipelines connecting Dinh Co GPP2 outlet to Thi Vai terminal.

The GPP2 is designed to recover LPG and have provisions for future ethane recovery while the Phu My GDC is equipped with a pig receiver, metering system and future tie-ins. A permanent access road has been constructed between the Landfall Station and Dinh Co GPP 2 to facilitate future operation and service.

Contractors involved with the Vietnamese offshore gas transfer project

The Vietsovpetro (VSP) joint venture was the engineering, procurement and construction (EPC) contractor for the project, having been awarded the contract in May 2014.

PetroVietnam Engineering performed the front-end engineering and design (FEED) study for the project, while Dorsch Gruppe rendered industrial engineering services.

PVPIPE supplied steel pipes and associated hot induction bends, risers and processing buckle arrestors for phase I. API 5L X65M PSL2 standard pipes have a wall thickness of 19.1mm, 23.8mm and 25.43mm.

PVCOATING applied anti-corrosion to the bends and anode installations, as well as concrete weight coating to the pipes. The first 20km of the coated pipes were delivered in October 2014.

TechnipFMC received an EPC contract worth between $75m and $250m for the engineering and installation of the 118km pipeline. The scope of the work also covers subsea structure fabrication for tying the Nam Con Son 2 phase I gas pipeline to the Long Hai Landfall Station.

Financing for the Nam Con Son 2 pipeline project

Overall investment in the project is estimated to be $1.3bn, with approximately $400m earmarked for phase I. Roughly $946m will be invested in the development of phase II.

A $280m credit facility was provided by a syndicate of 11 foreign banks led by Cathay United Bank as the mandated lead arranger and includes the Bank of Tokyo – Mitsubishi UFJ, Oversea – Chinese Banking, First Commercial Bank, HuaNan Bank, May Bank, Taipei Fubon Bank, E. Sun Commercial Bank, Taiwan Shin Kong Commercial Bank, and the Shang Hai Commercial & Savings Bank.

The payback period is seven years, extendable by two years.

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