HCMC – Japan Petroleum Exploration Co., Ltd. (Japex) has announced its decision to withdraw from a proposed liquefied natural gas (LNG) receiving terminal project in the northern city of Haiphong, following a review of its economic viability.
The Japanese energy firm will divest its entire stake in its HCMC-based affiliate, ITECO Joint Stock Company (ITECO JSC), transferring its holdings to existing business partners.
The project, situated in the Nam Dinh Vu Industrial Park in Haiphong, was initiated in January 2022. The planned infrastructure included a jetty capable of handling up to 650,000 tons of LNG per year and a 50,000-cubic-meter storage tank designed to import, store and distribute gas to the industrial sector.
Since acquiring its stake in October 2022, Japex had conducted foundational engineering designs, identified potential off-takers, and searched for suppliers. However, the Japanese corporation concluded that securing long-term economic returns under current market conditions was unviable, leading to the exit. This move comes as Vietnam aggressively pushes for LNG infrastructure to diversify its energy mix and support its transition to lower-emission fuels.
Despite exiting the terminal project, Japex remains committed to the Vietnamese market through a different strategic lens. The company has been selected by Japan’s New Energy and Industrial Technology Development Organization (NEDO) to participate in the “International Demonstration Project on Japan’s Technologies for Decarbonization and Energy Transition” for fiscal year 2025.
Under this NEDO mandate, Japex will conduct a feasibility study on providing LNG-based energy services to industrial parks in Haiphong and other strategic locations. This shift aligns with Japex’s long-term strategy to strengthen its infrastructure and utilities segment to generate stable revenue streams – less sensitive to oil price volatility – while focusing its core asset portfolio on overseas upstream exploration and production activities.
