Vinacomin to import coal in 2016

Ships are loading coal at the Cua Ong CoalCompany in Quang Ninh Province. Coal exports in 2011-15 has slipped both inquantity and price due to the economic crisis.

Vinacomin said the import amount was expected to gradually increase in the future and would reach between 18 million and 20 million tonnes by 2020. The domestically produced coal would be 42 million tonnes in 2020.

In its recent reports to the Ministry of Industry and Trade, the group said its production and businesses had faced difficulties. Between 2011 and 2015, coal exports had reduced sharply both in quantity and price due to the economic crisis.

Downward trend

In 2011, coal consumption was 44.71 million tonnes including 16.9 tonnes for exports with a profit of VND8.6 trillion (US$382.2 million). In 2012, coal exports continued to drop with local consumption at 24.8 million tonnes and exports at 14.4 million tonnes.

Coal consumption was also showing a downward trend between 2013 and 2015 while increasing taxes and fees had raised production costs.

"Vinacomin has lacked capital for investment. That is the reason the group is finding it difficult to increase productivity, especially coal for electricity production," it said, and added that the flood in July and August caused serious damage of around VND1.2 trillion ($53.3 million) to its production.

The group's mineral production has also encountered problems due to decreasing exports and high inventory.

Mineral productivity from 2011 to 2015 reached 60 per cent of the set target.

Dang Thanh Hai, Vinacomin's general director has worked with Japanese Marubeni Group on electricity and coal import.

The Marubeni Group expected to accelerate co-operation with Vinacomin in Na Duong Thermopower Plant 2 as well as coal imports.

The two sides agreed that coal import has been considered a potential issue for co-operation in the future.

Marubeni has participated in 33 power plant projects in 22 countries.