The Choice of History
Following the reunification of the country, energy self-sufficiency was identified by the Government as one of the important tasks for national reconstruction. In the context of a domestic industry that had not yet formed a complete value chain, Vietnam took many steps to achieve energy self-sufficiency; one of which was the construction of its first oil refinery. In 1975, Vietnam collaborated with the French company Beicip to implement the first integrated oil refining and petrochemical project, planned to be located in Nghi Son ( Thanh Hoa province ) with a capacity of 6 million tons per year, producing fuel and several types of petrochemical products. In 1979, the project was temporarily suspended due to funding difficulties.
In the early 1980s, under the Economic and Scientific-Technical Cooperation Agreement between Vietnam and the Soviet Union, the two sides agreed on the location for the construction of a petrochemical complex in Thanh Tuy Ha (Dong Nai province). The complex was planned to be built in two phases: Phase 1 would involve the construction of a refinery with a crude oil processing line with a capacity of 3 million tons per year; Phase 2 would include the addition of another crude oil processing line to increase refining capacity to 6 million tons per year, and the establishment of a petrochemical complex producing plastics, synthetic fibers, and a fertilizer production line. In the early 1990s, Vietnam began clearing 3,000 hectares of land and conducting preliminary geological surveys, preparing the necessary supporting conditions for the construction of the complex. At this time, the Soviet Union had completed the basic design and was preparing the investment conditions for the project. However, due to changes in the political and institutional situation of the Soviet Union, the project was not continued.
After numerous projects failed due to both subjective and objective reasons, in 1994, Vietnam's first oil refinery was finalized at one of five locations: Nghi Son (Thanh Hoa), Hon La (formerly Quang Binh ), Dung Quat (Quang Ngai), Van Phong (Khanh Hoa), and Long Son (formerly Vung Tau). Following extensive surveys and calculations, Prime Minister Vo Van Kiet officially decided to choose Dung Quat (Quang Ngai province) as the site for the first oil refinery.
In the context of ever-increasing demand for petroleum products, while supply is almost entirely dependent on imports, building a refinery to proactively secure supply and reduce dependence on external sources has become an urgent requirement. The Dung Quat Refinery is the solution to this problem. From a barren sandy area in Quang Ngai, Dung Quat has become the birthplace of Vietnam's petrochemical industry, officially commencing commercial operation in 2009, marking a significant turning point for the national energy sector.
Before the Dung Quat Refinery, Vietnam only exported crude oil and had to import all refined petroleum products from countries with developed refining industries. This approach, similar to "selling raw materials and buying refined products," put the country at a disadvantage in terms of foreign exchange reserves, prices, and especially the risk of energy insecurity in emergency situations such as geopolitical instability, war, natural disasters, or epidemics. Establishing a domestic refinery is not only an economic requirement but also a key element in the national energy security strategy.
As a key player in Vietnam's petrochemical industry, Binh Son Refining and Petrochemical Joint Stock Company (BSR), a member of the Vietnam National Energy and Industry Group (Petrovietnam), has maintained the Dung Quat Refinery at a stable capacity, sometimes reaching 118% of its designed capacity to meet market demands. Each year, the refinery supplies over 6 million tons of petroleum products and other refined products, meeting more than 30% of domestic market needs. Notably, even during periods of market volatility, the refinery ensures a stable supply and adjusts production accordingly to maintain its domestic market share – clearly demonstrating its crucial role in ensuring national energy security.
Furthermore, BSR contributes to a special mission: producing specialized fuels for national defense, including fuel for submarines, warships, and military aircraft. BSR is the second unit outside the Russian Federation authorized to produce Jet A-1K and DO L-62 fuels according to Russian military standards. To date, the company has supplied more than 200,000 m³ of fuel to the Ministry of Defense, demonstrating its scientific and technological capabilities, its ability to localize specialized products, and the patriotic spirit of the BSR team.
A pioneering aspiration in the petrochemical refining sector in Vietnam.
Dung Quat Refinery plays a crucial role in ensuring national energy security. Recognizing this responsibility, BSR consistently develops well-structured development plans that align with the nation's overall direction. In its strategic plan for 2030 and vision for 2050, BSR aims to become the Vietnam National Refinery and Petrochemical Corporation – a leading enterprise in the industry, with regional competitiveness and a key role in the national energy security strategy.
For the period 2025-2030, BSR aims to produce at least 33.5 million tons of products, representing an average production growth of 3.5% compared to the previous period. The company will implement the Dung Quat Refinery Upgrade and Expansion Project, investing in key infrastructure such as storage tanks, ports, substations, etc., with the goal of establishing a National Petrochemical and Energy Center in Quang Ngai, in accordance with the Government's orientation.
Furthermore, BSR's development strategy focuses on digital transformation, mastering technology, developing green products, reducing CO₂ emissions, and adapting to the energy transition trend. Specific targets include: stable growth, safe plant operation at optimal capacity, improved energy efficiency (EII index below 100), perfecting the management system according to international standards, and developing high-quality human resources.
To realize its strategy, BSR has identified 11 key solution groups, including: improving legal policies, perfecting investment planning, strengthening value chain linkages in the industry, innovating governance models, applying digital technology in finance, investment, and production, diversifying input materials, expanding distribution channels, and promoting scientific research and development of environmentally friendly products.
BSR will also boost investment in the petrochemical and chemical sectors to create new raw materials and fuels to serve the domestic industry, while developing green products and sustainable fuels such as green hydrogen, ammonia, recycled CO₂, etc., aiming to become a sustainable energy enterprise in the future.
To achieve these goals, BSR's leadership has always been flexible in its management, especially in managing volatility. This has been demonstrated through BSR's management over the past period, particularly when the global oil market experienced significant volatility in the first half of 2025 due to geopolitical conflicts and the conflict between Iran and Israel, causing supply disruptions, logistics chain disruptions, and short-term fluctuations in Brent crude oil prices. In Vietnam, the Dung Quat Refinery also faced significant pressure from cheap imports and unstable raw material prices. However, BSR demonstrated strong management capabilities by maintaining stable operations and adapting flexibly to all situations.
Speaking about BSR's governance culture and operational flexibility, Mr. Nguyen Viet Thang, General Director of BSR, said: “The spirit of unity throughout generations of leaders is the foundation that creates BSR's identity. On that foundation, we build a flexible governance system, update investment strategies, promote digital transformation, innovation, and strengthen value chain linkages to create breakthroughs in operations and product development.”
The results for the first six months of 2025 are clear evidence: BSR produced over 3.84 million tons of products, achieving revenue of VND 69,300 billion, contributing VND 7,400 billion to the state budget, and exceeding its after-tax profit target. This achievement reflects the company's ability to forecast, plan, and proactively operate in the face of all market variables. BSR has developed various operational scenarios based on global supply and demand analysis and oil prices. Each scenario is linked to a plan for raw material imports, optimizing operations and product distribution accordingly. Simultaneously, the company has diversified its imports of more than 20 types of crude oil from the US, West Africa, South America, etc., tested new chemicals, and efficiently operated two sulfur recovery plants (SRU1 and SRU2) with a recovery rate of approximately 13 tons/day – saving costs and increasing processing efficiency.
With a clear and specific development strategy and proactive approach to energy transformation and transition, BSR has demonstrated its aspiration to be a pioneer and leader in Vietnam's refining and petrochemical industry, and its importance in ensuring national energy security. This aspiration is not only aimed at economic development but also represents BSR's commitment to contributing to a sustainable and energy-independent future for the country.
Thanh Hieu
Source: https://bsr.com.vn/web/bsr/-/nha-may-loc-dau-dung-quat-trong-hanh-trinh-tu-chu-nang-luong-cua-dat-nuoc
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