RMIT University Vietnam
DANG BICH HONG s3231326
[PV Drilling & Well Services JS Co]
I. Industry Overview
Since the "Doi Moi" period, Vietnam has open its door for adapting new business environment and foreign technology, business conducts, foreign investments, etc. The country has boosted exploration activities and has allowed more foreign company involvement in the oil industry. These efforts have resulted in rapid economic growth with GDP at 8.44% in 2007 and estimated GDP of 6.23% for 2008(www.mofa.gov.vn ) even with the global financial crisis. As the result, the country's oil industry has also gone under significant developments from 1986 when it launches the first production in Bach Ho oil field. After two decades, Vietnam held 600 million barrels of proven oil reserves as of January 2007 and mostly are located offshore according to the Oil & Gas Journal (OGJ). Moreover, EIA forecasts that the country's oil production will rise above 400,000 bbl/day in 2008(Petroleum industry).
Another research done by BMI indicates that Vietnam exports account for 4.16% of the regional oil supply in Quarter 2 of 2008 and expected to increase to 4.69% by 2012.
Vietnam's oil sector is dominated by the state-owned Vietnam Oil & Gas Corporation (PetroVietnam), which is under the control of the Ministry of Industry. All oil production in the country is carried out through more than 57 different types of contracts between PetroVietnam(PVN) and its foreign partners under such as Schlumberger, Haliburton, Mobil, BP, etcÃ¢ÂÂ¦( PVD Annual Report 2008)
Although the country crude oil export has been increasing, Vietnam still needs to import refined oil for domestic use. Oil being a scarce resource and accounts for 50% of total energy consumption in Vietnam. As the result, Vietnam is investing in a few refineries with the one in Dung Quat which...