Marubeni Jointly Awarded Large Coal-Fired Thermal Power Plant with Giant Chinese Manufacturer of Heavy Machinery in Vietnam in Succession

Nov. 16. 2006
Marubeni Corporation

Marubeni, together with Dongfang Electric Corporation (hereafter “Dongfang” with its head office located in Chengdu, Sichuan Province) who is giant Chinese manufacturer of heavy machinery, have been jointly awarded the order and signed the contract on November 16, 2006 with Hai Phong Thermal Power Joint Stock Company (Special Purpose Company), which is invested by state-owned Vietnamese companies, such as Electricity of Vietnam Group, for the construction of Hai Phong II Coal-Fired Thermal Power Plant with the total gross capacity of 600 MW. The contract is worth approximately 54 billion Japanese Yen, and the construction site is located at a coast of Hai Phong city, the national third economic city. The scope of work of this contract includes engineering, procurement,deliver of the equipment and the construction and installation work, on a Full Turn-Key basis. Marubeni will be responsible for the supply of Steam Turbine and Generators as main equipment from Fuji Electric Systems Co., Ltd. Dongfang will be responsible for the supply of the boilers and all other necessary equipment and system for the plant and carry out the construction and installation works.

Marubeni has been awarded seven contracts for the construction of the power plant in Vietnam since 1995.  With the awarding of the contract for this power plant, the total power generation capacity of Marubeni’s supplied facilities in Vietnam exceeds 2,400 MW, resulting in a share of about 20 percents of Vietnam’s total power generation.  In this project, Marubeni’s extensive experience in the field of power plant construction in Vietnam along with the highly-evaluated competitiveness and engineering of the consortium of Marubeni and Dongfang led to this contract award in succession.  Furthermore, the client also highly evaluates the execution capability of the contract for thermal power plant project, which was awarded to Marubeni and Dongfang last year with the identical capacity to this project.

It is under examination that 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 same undertaken by Dongfang will also be funded by The Export-Import Bank of China(China EXIM Bank).

This project is positioned as one of the national emergency & important projects in Vietnam for the purpose of bearing stabilized power supply to the northern part of Vietnam, where the power demand is rising arround new industrial areas due to factory construction by big Japanese manufacturers in recent years.  This power plant is provided with highly efficient anthracite coal-fired boilers and FGDs, which is environmentally friendly.

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 this project, it is the successful case that a combination of Chinese manufacturer’s price competitiveness and Marubeni’s rich experiences in the construction of power plants in Vietnam complement each other.

Marubeni plans to establish a more advanced partnership with Chinese manufacturers of large heavy machinery, including Dongfang, concerning contracts which Chinese manufacturers present an advantage, and to focus on new large-scale power plants in third countries.

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