Dung Quat Oil Refinery in the country's journey to energy self-sufficiency

Let me borrow an idea from poet Thanh Thao when talking about the construction of Dung Quat Oil Refinery to start the article: “The construction of Dung Quat Oil Refinery itself is an epic about labor, about sacrifice, about people's love for their country. Maybe we will have many oil refineries in Vietnam, but Dung Quat Oil Refinery is the first factory, the number 1 oil refinery”. In fact, after that epic was sung, Vietnam officially opened a new chapter in the journey of energy self-sufficiency, ensuring national energy security.

The Choice of History

After the country's reunification, the Government identified energy proactivity as one of the important tasks for national reconstruction. In the context of the domestic industry not yet forming a complete value chain, Vietnam has done many things to be self-sufficient in energy; one of which is to build the first NMLD. In 1975, Vietnam cooperated with the French Beicip Company to implement the first Refinery and Petrochemical Complex Project, planned to be located in Nghi Son ( Thanh Hoa ) with a capacity of 6 million tons/year, producing fuel and some types of petrochemical products. In 1979, the project was suspended due to difficulties in capital sources.

In the early 80s of the last century, according to the economic - scientific and technical cooperation agreement between Vietnam and the Soviet Union, the two sides agreed on the location to build a refinery and petrochemical complex in Thanh Tuy Ha (Dong Nai). The refinery and petrochemical complex was expected to be invested in and built in 2 phases. Phase 1 would build a refinery with a crude oil processing line with a capacity of 3 million tons/year; Phase 2 was expected to invest in an additional crude oil processing line to increase the oil refining capacity to 6 million tons/year and form a petrochemical zone producing plastics, synthetic fibers and a fertilizer production line. In the early 90s, the Vietnamese side carried out the clearance of a part of 3,000 hectares of land and a preliminary geological survey, preparing auxiliary conditions for the construction of this refinery and petrochemical complex. At this time, the Soviet side had completed the basic design and prepared investment conditions for the project. However, due to changes in the political and institutional situation of the Soviet Union, the project was not continued.

The construction of Dung Quat Refinery helps Vietnam successfully solve the problem of energy self-sufficiency for the country.

After many projects failed to be implemented due to both subjective and objective reasons, by 1994, Vietnam's No. 1 oil refinery was decided to be located at one of 5 locations: Nghi Son (Thanh Hoa), Hon La (formerly Quang Binh ), Dung Quat (Quang Ngai), Van Phong (Khanh Hoa) and Long Son (formerly Vung Tau). After many surveys and calculations, Prime Minister Vo Van Kiet officially decided to choose Dung Quat (Quang Ngai province) as the location for the first oil refinery.

In the context of the ever-increasing demand for gasoline and oil, while the supply is almost entirely dependent on imports, the construction of a refinery to proactively source supplies and reduce dependence on external sources has become an urgent requirement. Dung Quat Refinery is the decisive solution to that problem. From a pristine sandy area in Quang Ngai, Dung Quat has become the birthplace of Vietnam's petrochemical refining industry, officially entering commercial operation in 2009, creating an important turning point for the national energy sector.

Before Dung Quat Refinery, Vietnam only exported crude oil and had to import all finished petroleum products from countries with developed petrochemical refining industries. This practice is similar to “selling crude, buying refined”, causing the country to face many disadvantages in terms of foreign exchange reserves, prices and especially the risk of losing energy security in emergency situations such as geopolitical fluctuations, war, natural disasters or epidemics. The establishment of a domestic refinery is not only an economic requirement but also a key factor in the national energy security strategy.

BSR staff actively innovate and implement initiatives into production practices.

With a key role in the Vietnamese petrochemical industry, Binh Son Refining and Petrochemical Joint Stock Company (BSR), a member of the Vietnam National Energy Industry Group (Petrovietnam), has maintained Dung Quat Refinery's operations at a stable capacity, sometimes up to 118% of its design capacity to meet market demands. Each year, the plant supplies over 6 million tons of gasoline and other products, meeting more than 30% of domestic market demand. In particular, during times of market fluctuations, the plant still ensures a stable supply, promptly regulating output to maintain the domestic market - clearly demonstrating its important role in ensuring national energy security.

Not stopping there, BSR also contributes to the implementation of 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 licensed to produce Jet A-1K and DO L-62 fuels according to Russian military standards. To date, the company has provided more than 200,000 m³ of fuel to the Ministry of Defense, demonstrating the scientific and technological capacity, the ability to localize specialized products and the spirit of serving the Fatherland of the BSR team.

Aspiration to be a pioneer in the field of petrochemical refining in Vietnam

Dung Quat Refinery plays an important role in ensuring energy security for the country. Realizing that responsibility, BSR always builds methodical development plans, in line with the general orientation of the country. In the orientation to 2030, with a vision to 2050, BSR aims to become the Vietnam Oil and Gas Refining Corporation - a key enterprise in the industry, with regional competitiveness and playing a key role in the strategy to ensure national energy security.

In the 2025-2030 period, BSR aims to produce at least 33.5 million tons of products, with an average output 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 tanks, ports, transformer stations, etc., aiming to form a National Oil Refinery and Energy Center in Quang Ngai according to the Government's direction.

Dung Quat NMLD plays an important role in ensuring national energy security.

Along with that, BSR's development strategy focuses on digital transformation, mastering technology, developing green products, reducing CO₂ emissions and adapting to energy transition trends. Specific targets include: stable growth, safe plant operation at optimal capacity, improving energy efficiency (EII index below 100), perfecting the management system according to international standards and developing high-quality human resources.

To realize the strategy, BSR identified 11 key groups of solutions, including: improving legal policies, perfecting investment planning, strengthening value chain linkages in the industry, innovating governance models, applying digital technology in finance - investment - production, diversifying input materials, expanding distribution channels, and promoting scientific research and developing environmentally friendly products.

BSR will also step up investment in the petrochemical and chemical sectors to create new raw materials and materials to serve the domestic industry, while developing green products and sustainable fuels such as green hydrogen, ammonia, recycled CO₂, etc., aiming for a sustainable energy enterprise in the future.

To achieve these goals, BSR's leadership has always been flexible in management, especially in managing fluctuations. This has been demonstrated through the way BSR has operated in the past, especially when the world oil market in the first half of 2025 fluctuated strongly due to geopolitical conflicts in the world and the war between Iran and Israel, causing supply disruptions, disrupted logistics chains, and short-term fluctuations in Brent oil prices. In Vietnam, Dung Quat Oil Refinery also faces great pressure from cheap imports and unstable raw material prices. However, BSR has shown a clear mark of management by maintaining stable operations and adapting flexibly to all situations.

BSR's pioneering aspiration is to commit to contributing to a future of sustainable development and energy self-sufficiency for the country.

Talking about BSR's management culture and operational flexibility, Mr. Nguyen Viet Thang - General Director of BSR, said: "The spirit of solidarity throughout generations of leaders is the foundation that creates BSR's identity. On that foundation, we build a flexible management system, update investment strategies, promote digital transformation, innovate and strengthen value chain linkages to create breakthroughs in operations and product development."

The results of the first 6 months of 2025 are clear evidence: BSR produced more than 3.84 million tons of products, achieved revenue of VND 69,300 billion, paid VND 7,400 billion to the budget and after-tax profit exceeded the plan. This achievement reflects the ability to forecast, plan and operate proactively in all market variables. BSR has built many different operating scenarios based on global supply - demand analysis and oil prices. Each scenario is associated with a plan to import raw materials, optimize operations and distribute appropriate products. At the same time, the company diversified more than 20 types of imported crude oil from the US, West Africa, South America..., tested new chemicals, and effectively operated 2 sulfur recovery workshops (SRU1 and SRU2) with a recovery capacity of about 13 tons/day - both saving costs and increasing processing efficiency.

With a clear and specific development strategy and proactive energy conversion and shift, BSR has demonstrated its aspiration to pioneer and lead the Vietnamese petrochemical industry and its importance in ensuring national energy security. This aspiration is not only aimed at economic development, but also a commitment to contribute to a sustainable development future and energy self-sufficiency for the country of BSR.

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