Gas Group (PetroVietnam) Do Chi Thanh called for incentive suggestions so that the investment climate in this industry can regain its attractiveness.. (Photo: Bao tainguyen muoi truong}

Nguyen Van Que, General Director of the Cuu Long Joint Operating Company - which is running the Su Tu Trang (White Lion) project, said the overlaps among existing laws such as the Petroleum Law and the Law on Public Investment have been impeding the implementation of exploration and exploitation projects.

Citing difficulties his company faced when operating Su Tu Trang, he said in this law, the regulation on capital preservation at risky projects such as oil and gas exploration and exploitation should be amended in order to attract businesses, especially foreign ones.

The Cuu Long JOC also proposed Article 47 on the making, assessment, and approval of development plans for oil and gas wells be revised.

Trinh Viet Thang, member of the Members’ Council of the PetroVietnam Exploration Production Corporation (PVEP), said his firm has 35 oil and gas contracts but most of them are about to expire. PVEP carried out 26 projects from 2007 to 2015. However, since the Law on Public Investment took effect in 2016, only two new projects have been signed.

New oil and gas projects are hard to be signed and develop partly because most of Vietnam’s investment incentives are related to exploitation zones, not the exploitation scale like in many other countries, he explained.

In addition, projects in the industry are currently subject to regulations in many laws such as the Petroleum Law and the Law on Public Investment. Therefore, for enterprises completely owned by the State like PVEP, all projects in Group B (which are worth between 120 billion VND (5.13 million USD) and under 2.3 trillion VND) must be submitted to authorities at different levels, which is time-consuming and may encountered many problems.

At a seminar on revisions to the Petroleum Law held in Vung Tau city on August 5, Deputy General Director of the Vietnam Oil and Gas Group (PetroVietnam) Do Chi Thanh called for incentive suggestions so that the investment climate in this industry can regain its attractiveness.

He emphasised the consistent principle that the Petroleum Law must be designed in a manner that concurrently boosts the development of the oil and gas sector and the economy as a whole; protects Vietnam’s rights and legitimate interests at sea in line with international law; ensures human and property safety as well as investors’ legitimate interests on the basis of respecting Vietnam’s independence, sovereignty, territorial integrity and national security, and adhering to the country’s laws.

Chairman of the Vietnam Petroleum Association Nguyen Quoc Thap held that the law should be revised comprehensively, and even a new petroleum law should be built to meet current demand.

He pointed out that many oil and gas projects are being implemented in sensitive areas, so in many cases, they could not be offered for open international bidding. Besides, many of such projects are located offshore and need a large number of accompanying supplies and services, thus causing additional expenses. All of these issues should be regulated in the new law to attract foreign investors.

Meanwhile, Deputy General Director of PVEP Hoang Ngoc Trung said the law needs to detail investment procedures for oil and gas projects, investment incentives, and financial mechanisms for dealing with risks.

A new law will provide an important impulse and necessary legal corridor for PVEP to immediately carry out five new projects and increase reserves, he told the seminar.

Phan Duc Hieu, permanent member of the National Assembly’s Committee for Economic Affairs, said the revised law should focus on improving the effectiveness and efficiency of oil and gas-related activities and enhancing investment attractiveness.

It also needs to be added with regulations on all stages from exploration to exploitation, compatible with other laws, and include competitive, long-term and flexible investment incentives, according to him.

The draft revised law is scheduled to be submitted to the NA Standing Committee for consideration this August and to the NA this October.