Jul. 20. 2005
The First Jointly Awarded Project with Dongfang Electric Corporation of China、Marubeni Corporation
Marubeni and Dongfang Electric Corporation (hereafter “Dongfang,” with its head office located in Chengdu, Sichuan Province), Giant Chinese manufacturer of heavy machinery, have been jointly awarded the contract for the construction of the Hai Phong coal-fired thermal power plant. The project is for Hai Phong Thermal Power Joint Stock Company, which is funded by government-owned Vietnamese companies, such as Electricity of Vietnam.
The value of the contract is about JPY 50 billion, and the total installed capacity of the power plant will be 600 MW. The scope of work of this contract includes engineering, civil works, the supply of the equipment and its installation works on a full turnkey basis. The planned date of completion is the beginning of 2009.
This project marks the first time that Japanese company and Chinese manufacture have been awarded jointly the contract to construct a large-scale power plant in a third country.
Marubeni and Dongfang formed a consortium for this project. Marubeni will supply the main equipments, Steam Turbine and Generator from Fuji Electric Systems Co., Ltd. . Dongfang will manufacture and supply the boilers and the balance of the plant.
The scope of work being undertaken by Marubeni will be funded by the Japan Bank for International Cooperation (JBIC) with private financial institutions considering the provision of buyer's credits . The scope of work undertaken by Dongfang will be funded by the Export-Import Bank of China, which is considering providing buyer's credits.
Chinese manufacturers of heavy machinery are pressing their exports mainly into Asian countries, considering the domestic economic trends after the Beijing Olympic Games in 2008. Vietnam is one of the markets into which China is directing its energies. In Vietnam, some people have been concerned at the lack of experience of Chinese manufacturers in plant supply and construction outside China, although they have price competitiveness. With this project, Vietnam has rated highly the fact that Marubeni, which has a long record of achievement in the construction of power plants in Vietnam, offsetting the deficiency of China in this regard. Consequently, Marubeni and Dongfang have been awarded jointly the contract for the project.
The Ministry of Industry, the Socialist Republic of Vietnam and Electricity of Vietnam have created a long-term power supply program to provide measures that can resolve the issues caused by the increase in power demand due to the recent significant economic growth in Vietnam. This project involves the construction of a new power plant in the northern part of Hai Phong, Vietnam’s third largest city in terms of the economy, and is one of the important projects under that program. The power plant is provided with highly efficient anthracite coal-fired boilers and FGDs, which reduce the environmental burden of the facilities.
Marubeni has been awarded four consecutive contracts for the construction of the Phu My power plant in southern Vietnam. Marubeni has also been awarded the contract for a coal-fired thermal power plant in northern Vietnam, and is now constructing the plant. With the awarding of the contract for this power plant, the total power generation capacity of Marubeni’s facilities in Vietnam exceed 1,800 MW, resulting in a share of about 20 percent of Vietnam’s total power generation.
Marubeni plans to establish a more advanced partnership with Chinese manufacturers of large heavy machinery, including Dongfang, concerning contracts where Chinese manufacturers present an advantage, and to construct new large-scale power plants in third countries.