Mitsui’s Vietnamese gas field project gains momentum with a final investment decision

Mitsui’s Vietnam Block B Project – encompassing an upstream gas field and a pipeline linking it to a gas-fired thermal power plant complex – has moved closer to production.

Through its wholly owned subsidiary, Mitsui Oil Exploration (MOECO), the company has made a final investment decision and concluded related contracts together with its business partners in the integrated development project. Production capacity is estimated to be 490 million cubic feet per day with production scheduled to begin by the end of 2026.

Local collaboration

Mitsui’s business partners in the project include Vietnam Oil and Gas Group (PVN), Vietnamese national oil and gas company PetroVietnam Exploration Production Corporation Limited (PVEP), PetroVietnam Gas Joint Stock Corporation (PV Gas), and Thai national oil and gas company PTTEP (PTT Exploration and Production Public Company Limited).

The Block B Project is touted as the next-generation core business for MOECO. It has been participating in this “highly competitive project” from the exploration phase and is expected to yield stable earnings from it in the long-term.

Ensuring transition gas supply

Alongside development of the upstream gas field, the project includes a midstream development for gas transportation.

MOECO subsidiaries’ share of development cost for the project - mainly offshore installations and pipeline construction - will be approximately US$ 740 million, Mistui has revealed. This cost only includes CAPEX until commencement of production.

MOECO’s interest in the upstream business (about US$560 million) is through joint investment companies with JOGMEC, and the midstream business (approximately US$180 million) is through MOECO’s wholly owned subsidiary.

Having identified global energy transition as one of its key strategic initiatives in its Medium-term Management Plan 2026, Mitsui considers natural gas and LNG playing an important transition role and views them as “real solutions”.

“The Block B Project will contribute to the sustainable transition to a decarbonised society through the development of gas fuel supply for power generation,” added the company.