Dinh La Thang, Trinh Xuan Thanh prosecuted for irregularities at ethanol plant

HCMC – Dinh La Thang, former chairman of Vietnam National Oil and Gas Group (PVN), and Trinh Xuan Thanh, former chairman of PetroVietnam Construction Corporation (PVC), and 10 other defendants have been prosecuted for their alleged violations at an ethanol plant project in the northern province of Phu Tho, causing losses of over VND543 billion.

The Supreme People’s Procuracy has issued an indictment against the case involving violating regulations on construction causing serious consequences and abusing position and power while on duty at PetroVietnam Bio-ethanol Company (PVB) and the Phu Tho ethanol project, the local media reported.

The 10 other defendants include former PVB general director Vu Thanh Ha, former PVN deputy general director Tran Thi Binh, and Do Van Quang, former head of PVN’s economy and planning board.

According to the indictment, on July 17, 2007, PVN issued a resolution on the development of an ethanol plant in the northern region. Three months later, former PVN Chairman Thang signed a decision to approve the project.

PVB was established on December 27, 2007, to develop the ethanol plant in Phu Tho Province. PVB’s capital was contributed by PVN, Southeast Asia Commercial Bank and other shareholders.

The plant was expected to annually produce some 100,000 cubic meters of ethanol.

Work on the plant started in September 2009. Since then, it has seen a surge in the required investment from the initial VND1.3 trillion to VND2.5 trillion.

Before the execution of the Phu Tho ethanol project, PVB had conducted the preliminary selection process for contractors, with the participation of six bidders, including a consortium of contractors from PVC, Sweden’s Alfa Laval and U.S.-based Delta-T Group. They all failed to meet the requirements.

Although PVB had plans to choose the contractor of the project through a tender, Thang still appointed the consortium to take charge of the TK05 package, which included the design, procurement and supply of materials and equipment and the construction of the ethanol plant.

Meanwhile, Thanh repeatedly proposed that PVN and PVB choose PVC as the contractor of the project.

Later, PVC also admitted that the consortium was ineligible to become the contractor of the project. In March 2013, the project was suspended with no component of the plant being completed.

According to the Supreme People’s Procuracy, Thang, who was chairman of PVN and head of a board in charge of bio-fuel projects at the time, knew that PVC was incapable of developing the project but directed the relevant agencies to appoint PVC/Alfa Laval/Delta-T as its contractor.

Thanh, Ha and Binh also knew of the consortium’s inability and inexperience but still carried out Thang’s orders, causing losses for PVB.