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Vietnam’s largest thermal power plant to soon be commenced

Kien Luong 1 Thermal Power Plant attracts public attention not only for its large capacity but also as the first project being implemented in the BOO form and receiving the Government’s credit guarantee.

The power shortage is increasingly pressing for the economy. Therefore, large power plants should play a crucial role in relieving such shortage pressure. The 1,200 MW Kien Luong 1 thermal power plant with a total investment of USD 2.5 billion, upon completion (expected by 2013-2014), will contribute significantly to relieve the power shortage pressure for the Southern region. The Project, therefore, attires particular public attention.

The time is not much left
Kien Luong 1 Thermal Power Plant attracts a public attention not only for its large capacity but also as the first project being implemented in the BOO form and receiving the Government’s credit guarantee.
This is the first time the Government assigns Tan Tao Group, a non-state enterprise, for implementation of such project.

Kien Luong 1 Thermal Power Plant is part of the Kien Luong Thermal Power Complex. According to the proposal of the Ministry of Finance, Kien Luong 1, as a power source investment project in the National Electricity Development Master Plan VI for the period 2006-2015 with a vision toward 2025, is complied with Article 3 of the Prime Minister’s Decision No. 110/2007/QD-TTg dated July 18, 2007 regulating that power source projects and transmission lines interconnected to the national electricity system for the period 2006-2015 invested by domestic companies according to the Prime Minister’s Decision No. 1195/QD-TTg dated November 9, 2005. On that basis, in Official Letter No. 5040/VPCP-KTTH dated July 27, 2009, the Prime Minister approved in principle the issue of the Government guarantee for Kien Luong 1 Thermal Power Project.
According to Ms. Dang Thi Hoang Yen, Chairman of Tan Tao Group, procedurally, Kien Luong Thermal Power Project will commence after completing three phases: Backfilling, procedures for Government’s loan guarantee and electricity price negotiation with EVN. Currently, the Group is endeavoring to untie difficulties for the commencement of Kien Luong 1 thermal power plant in December 2010.

Tan Tao continues to petition Kien Giang province’s leaders for permitting the mining in Hon Tre, Ong Cop Mountain, Huynh Mountain and Son Tra Mountain. According to engineer Le Van An, General Director of Agriculture & Irrigation Mechanization Electrification – Construction Corporation (Agrimeco), in October 2010, Agrimeco will bring in a large number of engineers, workers and machinery to Kien Luong for construction of water reservoir, using excavating soil and rock for sea reclamation as supplement resource and contribute to surmount backfilling materials' issue.

The financial arrangement for the project and electricity price negotiation also have gained positive outcomes. Tan Tao, along with 15 renowned international and domestic consultants, has actively been working with large banks of international credit institutions and General Credit Insurance Sinosure (China) on loans for the project and the Group has received active commitments from the banks, especially from Sinosure. It will only be taken into official consideration after GGU and PPA have been achieved. It is expected that another VND 400 billion from the issued bonds will be spent in order to timely hand over the layout to the owner (excluding the invested VND 2,000 billion since 2007).

Mr. Pham Vu Hong, Vice Chairman of Kien Giang province, affirmed the province always creates favorable conditions to Tan Tao Group for implementation of the project as a national key project. The province has directed Kien Luong district to focus on land clearance to soon hand over the construction layout to the owner

Nearly VND 2,000 billion for sea reclamation

In our feeling upon arrival, Kien Luong district was a sparsely inhabited area with many economic difficulties. Nevertheless, Kien Luong has recently observed large transformation. Kien Luong Thermal Power Project has been promoting the development of a remote region in the Southwest sea of the country. According to Mr. Bui Ngoc Suong, Chairman of Kien Giang province, "This project will not only meet the increasing load demand, but also contribute to promote the image of Kien Giang, create new attractiveness of the province to investors".
According to the schedule, Kien Luong 1 will officially be interconnected into the national grid in 2013-2014 and will relieve the power shortage pressure in the Southern region. Ms. Dang Thi Hoang Yen, Chairwoman of Tan Tao Group, stated: "With such significant role, the Kien Luong Thermal Power Project is receiving a special attention from the Government, ministries and local authorities. As the first non-state enterprise approved by the Government for investment of a power generation project and receiving the Government credit guarantee, we are strongly determined and are providing all efforts on Kien Luong Thermal Power Project. We have pledged to the Government to successfully execute the Project. That is an answer to the question from many people why, even there hasn’t been an official commencement directive of the Government, ITACO has poured nearly VND 2,000 billion... into the sea!? But time is not waiting for us! To ensure the power plant to operate in 2014 according to the schedule set by the Government, we must complete the entire plant layout at the latest in December 2010".

In the middle of a busy construction site with numerous vehicles and machines, sprawling soil, rock, sand, gravel and concrete, we're suddenly stopped short by a gorgeous flower garden right close to the immense sea. Why is there a helicopter parking lot and such a beautiful flower garden? In confidence, Ms. Yen said "This is a cultural highlight we want to build up: a symbol green, clean, beautiful, friendly environmental thermal power plant. In addition, the flower garden demonstrates our confidence, strength and will in the determination of building a successful Kien Luong Thermal Power Plant. "

People coming here to the site will surely see a huge amount of work and understand Tan Tao’s difficulties to overcome in launching the project. Kien Luong Thermal Power Project is reaching out 4km from the shore. The relocation of the plant to the reclamation area is a breakthrough of the project to solve the land clearance's issue. This proposal quickly obtained approval from the Prime Minister and the Ministry of Trade and Industry in late 2009. In early 2010, Kien Giang province has officially delivered the sea surface to Tan Tao for mud dredging, land clearance and infrastructure construction.

From March 2010 to now, the backfilling is swiftly taking place as the layout is a prerequisite for construction of the plant. It is really a huge work, dredging tens of millions cubic meters of mud in the seabed and filling 48 million cubic meters of soil and sand. In particular, Tan Tao completed the first phase of the Project. Especially, driving concrete piles for sea separation is regarded as a great achievement in Vietnam's construction industry. The construction company has to mobilize heavy-duty barges and vessels for driving 8km of sheet piles with 1m in width and 28 to 44m in length using Japan’s technology to build an embankment dike for creation of a separate project area – the solution used for the first time in Vietnam.

In the middle of the immense sea, observing engineer and workers swiftly driving sea separation piles is abruptly reminiscent of the long period where many investors had to give it up after accessing and investigating Kien Luong thermal power plant. Nevertheless, after many investigations assisted by domestic and international specialists at very high costs, and it sometimes seems that all efforts and money were wasted into the sea, Tan Tao has then found that Nam Du Island can be the location for a deep-water sea port and formally make the Plan of Kien Luong Thermal Power Plant become feasible – a major milestone marking the development of the Mekong Delta.