Access to Vietnamese market is hampered by the ESPO pipeline – Rosneft and Gazpromneft don’t agree on refinery

Gazpromneft and Rosneft have started an active struggle for the refinery of Zung Quat in Vietnam: Hanoi is ready to allow a company, which will undertake to supply oil to this plant, to buy it. But Rosneft has an advantage: the company almost monopolized oil supplies via the Eastern Siberia-Pacific Ocean pipeline. Gazpromneft hasn’t managed to receive an appreciable quota at ESPO.

On November 12th, during the visit of Vladimir Putin to Vietnam, Gazpromneft will be able to sign an agreement with PetroVietnam on oil supplies and participation in project of its processing, the Prime reported at the end of the last week, referred to its sources. The company wants to supply up to 8 million tons of oil per year to the country. It needs this to become a co-owner of the local refinery Zung Quat, sources of Kommersant that are close to the negotiations say. Gazpromneft is interested in purchase of the share and the condition of the Vietnamese is to provide supplies of Russian oil there, - one of  Kommersant’s interlocutors says. According to him, the deal can be conducted at two stages. “At first, Gazpromneft wants to receive 50% of the refinery and then to increase its share to the controlling one – over 60%,” – he notes. PetroVietnam estimates 100% of the refinery at $3.5-4 billion. Gazpromneft doesn’t comment on this.