Vietnam’s state-owned oil & gas company Petrovietnam (PVN) has awarded its subsidiary a contract to build a 1200 MW coal fired power plant in the south of the country.

The subsidiary, Petrovietnam Technical Services Corp (PTSC), will buy and install equipment, build and test-run the Song Hau 1 thermal power plant in the Mekong Delta province of Hau Giang within 45 months, based on a broad agreement with PVN, the New Energy newspaper said.

The new plant in the existing Song Hau power complex is expected to generate around 7.8bn kWh of electricity per year. Interestingly, it will use coal imported from Indonesia and Australia, despite Vietnam currently being a new exporter of coal.

The two sides still need to sign a specific contract following the broad agreement reports Reuters.

Last December, PTSC also won a PVN contract to build the $1.2bn Long Phu 1 coal fired power plant in southern Soc Trang province.

Vietnam Electricity, the state utility, has said that coal will take over from hydropower as the leading fuel for new electricity generation in Vietnam in the next five years.

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