General Secretary To Lam and President of Azerbaijan Ilham Aliyev witnessed the exchange of a Memorandum of Understanding on long-term crude oil supply to Dung Quat Oil Refinery between BSR - a member unit of Petrovietnam and the Ministry of Economy of Azerbaijan.
Since 2009, two member units of Petrovietnam, PVOIL and BSR, have signed many agreements and contracts with SOCAR Trading SA (a subsidiary of SOCAR - Azerbaijan National Oil and Gas Group) to supply Azeri crude oil to Dung Quat Oil Refinery.
From 2010 to the end of January 2025, SOCAR Trading Singapore (a branch of SOCAR Trading SA in Singapore) provided Dung Quat Oil Refinery with 35 Azeri oil cargoes with a volume of nearly 31.7 million barrels (equivalent to 4.34 million tons) with a total value of about 2.55 billion USD.
BSR's signing of a Memorandum of Understanding with SOCAR Trading Singapore on long-term crude oil supply for Dung Quat Oil Refinery has many strategic meanings. This cooperation helps BSR secure long-term raw material sources and respond more effectively to global geopolitical instability.
Azeri crude oil tanker docks at SPM buoy to import oil for Dung Quat Oil Refinery.
It is expected that SOCAR Trading will supply BSR with up to 2 million barrels of Azeri crude oil per month (starting from July 1, 2025 until the end of 2035). Thus, it can be calculated that each year, Azeri oil can be processed at Dung Quat Oil Refinery at about 3.4-3.5 million tons/year, meeting about 50% of the crude oil processed each year (about more than 7 million tons/year). Buying directly from SOCAR Trading Singapore also helps BSR shorten the intermediary chain, save logistics costs and ensure a stable operating schedule.
Given the current situation of Bach Ho crude oil (the main source of supply for Dung Quat Oil Refinery) being on the decline after many years of exploitation. The ability to self-supply domestic raw materials is increasingly narrowing, requiring BSR to have a strategy to expand imports from international sources to maintain safe and stable operation of the Refinery. Azerbaijan's Azeri crude oil is one of them. The addition of Azeri crude oil - which is light, low in sulfur, and easy to process - helps BSR improve operating efficiency, reduce processing costs and optimize the performance of the entire system.
In addition to Azeri oil, there are other types of crude oil suitable for Dung Quat Oil Refinery's technology such as: Bonny Light (Nigeria), WTI (USA), Murban (UAE)... that partner SOCAR Trading SA can provide, helping BSR not depend on a single source of supply, making the factory more flexible in changing operating modes.
This memorandum of understanding is a strategic step in preparing imported crude oil sources for the Dung Quat Oil Refinery upgrade and expansion project, expected to be completed in 2028. After the upgrade and expansion, Dung Quat Oil Refinery will be able to process hundreds of different types of crude oil, increasing flexibility and adaptability to the market.
Linh Dan
Source: https://baochinhphu.vn/bsr-mo-rong-hop-tac-quoc-te-bao-dam-nguon-dau-tho-chien-luoc-cho-nha-may-loc-dau-dung-quat-102250509131300979.htm
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