Vietnam’s Nghi Son refinery may incur $1 billion loss in 2023 – Kuwaiti document

KUWAIT :Vietnam’s Nghi Son Refinery and Petrochemical complex, in which Kuwait Petroleum International (KPI) owns a stake, could incur a $1 billion loss this year, an official document signed by Kuwait’s oil minister and seen by Reuters on Wednesday showed.

The loss is expected on the back of price volatility, increasing interest payments for loans and a two-month maintenance shutdown, Kuwait’s oil minister Saad al-Barrak wrote in the document.

The document is Barrak’s written response to a question from a Kuwaiti parliamentarian over the issue.

Nghi Son Refinery and Petrochemical, Vietnam’s largest oil refinery, is 35.1 per cent owned by Japan’s Idemitsu Kosan Co (5019.T), 35.1 per cent by Kuwait Petroleum, 25.1 per cent by Vietnam’s state oil firm PetroVietnam and 4.7 per cent by Mitsui Chemicals Inc.

PetroVietnam and KPI were not immediately available for comment outside of office hours.

“It is currently difficult to put a timeframe for profitabiilty,” Barrak wrote in the letter, adding that discussions had been ongoing between partners to come up with short term and long term measures to improve performance.

Idemitsu, Japan’s second-biggest oil refiner, said earlier this month that Nghi Son had been profitable in operating earnings terms, but not in net earnings, adding that discussions were ongoing amongst sponsors of the refinery to improve profitability.

The $9 billion refinery is set to begin scheduled maintenance from the end of Aug. for about 50 days.