Energy tops agenda in Russian agreements

Energy tops agenda in Russian agreements

Vietnam and Russia have intensified bilateral ties in economy, trade, and investment, with one of the focuses laid on energy development, including nuclear power.

During Russian Prime Minister Mikhail Mishustin’s official visit to Vietnam last week when he met with the country’s leaders, both nations approved a comprehensive plan of cooperation towards 2030, boosting ties in sectors such as trade, investment, agriculture, industry, healthcare, and energy.

Most notably, a deal was clinched between Russia’s State Atomic Energy Corporation (Rosatom) and Vietnam Electricity at a time when the Southeast Asian country is seeking to revive its nuclear energy plans to achieve energy self-sufficiency and meet its 2050 greenhouse gas emissions goals.

“Our two countries have great potential for collaboration in nuclear energy. We support the project to build a nuclear science and technology centre in Vietnam,” PM Mishustin said.

At a meeting with Rosatom director general Alexey Likhachev in Hanoi last week, Vietnamese Prime Minister Pham Minh Chinh said that he appreciates Russia’s cooperation with and support for Vietnam in training experts in nuclear energy, designing and operating the Dalat nuclear reactor, developing the Vietnam-Russia Tropical Centre, and supplying pharmaceuticals for cancer diagnosis and treatment.

PM Chinh expects Russia and Rosatom to continue cooperation with Vietnam, not only in the development of nuclear power but also in nuclear science and technology for peaceful purposes.

Likhachev said Rosatom would continue strengthening cooperation with Vietnam and carrying out high-level agreements between the two countries. He underlined that Rosatom was ready to support Vietnam in constructing nuclear power plants, establishing a new nuclear centre, transferring technology, localising nuclear products, and developing nuclear science, with a long-term vision spanning hundreds of years.

Photo: Ba Ria-Vung Tau Department of Culture and Sports

In November 2024, Vietnam’s National Assembly adopted the revised Law on Electricity, which covers regulations on nuclear power development. The law states that nuclear power planning is an integral and synchronous part of national power development to ensure the goal of electricity supply security.

“A nuclear power project is an important one related to national security, which shall be funded, constructed, and operated by the state,” the law read. “Investment, construction, operation, and termination of operations, and safety assurance of nuclear power plants, must comply with the provisions of the Law on Atomic Energy and other relevant legal provisions.”

Vietnam delayed the construction of two nuclear power plants in Ninh Thuan province in 2016 due to limited budget and safety concerns. The plants are located in Thuan Nam district, spanning over 440 hectares on land and a similar size in the sea. Each plant was to have two turbines with a total combined capacity of 2,000MW.

While Ninh Thuan 1 was set to be built by Atomstroyexport, a subsidiary of Rosatom, Ninh Thuan 2 was aimed to be constructed by the International Nuclear Energy Development of Japan Company, a consortium of 13 Japanese firms.

Expanding energy cooperation

Last week Vietnam and Russia also declared that they would continue cooperating on the existing oil and gas projects and new ones, including the supply and processing of crude oil and liquefied natural gas (LNG) for Vietnam.

“Energy cooperation between our countries has strategic importance. Vietsovpetro, a joint company, has been developing Vietnam’s oil and gas deposits for half a century now, while Rusvietpetro carries out projects in Russia’s Nenets Autonomous Area,” PM Mishustin said.

Favourable conditions and support are to be created for the expansion of operations of Vietnamese oil and gas companies in Russia and of Russian oil and gas companies in Vietnam’s continental shelf in line with the laws of Vietnam and Russia, and international laws as well.

While Russia’s Gazprom is exploiting gas in Vietnam, another Russian giant, Novatek, is also planning to implement LNG in the country. Novatek has inked a memorandum on cooperation with PetroVietnam, while Zarubezhneft has obtained a licence to develop Block 11.2 on Vietnam’s continental shelf.

Also, hydroelectric power generation company RusHydro intends to help expand the capacity of hydroelectric power stations on Vietnamese rivers. A joint Russian-Vietnamese scheme to construct a 1,000MW offshore wind power plant in the south-central province of Binh Thuan has been added to Vietnam’s current power development plan.

Fostering agriculture and trade

In addition to energy cooperation, Vietnam and Russia are also cementing ties in the agricultural sector. The issue of expanding agricultural investment flows and certifying agricultural producers from Russia with a view to boosting supplies of agricultural products to Vietnam was also highlighted at negotiations during Mishustin’s visit.

“Much has already been done, firstly, on the supply of agricultural products to the Vietnamese market. We now need to expand the certification of Russian agricultural producers, which is what we discussed today,” Russian Economic Development Minister Maxim Reshetnikov said. “Overall, the Vietnamese economy is growing, consumption is increasing, and the standard of people’s living is rising, so this creates demand for our goods.”

Vietnam committed to facilitate its businesses investing in Russia. TH Group is Vietnam’s biggest investor in Russia in this sector, with $2.7 billion high-tech centralised dairy farming and processing complex.

At present, two farms have been put into operation, with the total number of dairy cows at over 6,000. Another farm is under construction in Moscow and a milk processing factory is being completed in Kaluga province.

In May last year, TH Group also commenced construction of a $216.7 million high-tech centralised dairy farming and milk processing project in the Far Eastern region of Russia. This initiative includes a 6,000-cow farm, a 250-tonne-of-milk-per-day factory, and a material area of 13,000ha.

“We want to contribute to the flourishing Vietnam-Russia trade and investment ties,” said Ngo Minh Hai, chairman of TH Group’s Board of Members. “We commit to speeding up the construction so that the undertaking can become operational by late 2027.”

Vietnamese investors are investing in Russian 25 projects registered at nearly $3 billion. Meanwhile, Russian businesses are pouring $994 million into just over 200 projects in Vietnam, focusing on oil and gas, restaurants and catering, and manufacturing and processing.

“Of course, Russia is also looking forward to expanding cooperation in the transport and logistics sector. There has been a steady rise in cargo shipments by sea between Russian and Vietnamese ports. We also suggest undertaking a series of joint projects in digital technology, focusing on AI, big data, cybersecurity, and software development,” PM Mishustin said.

“We have made expanding trade and economic ties our priority. Mutual trade has been experiencing upward momentum, having increased by 24 per cent last year, which was attributable, among other things, to the effort to fulfil the free trade agreement between the Eurasian Economic Union and Vietnam.”

The General Department of Vietnam Customs reported that total export-import turnover between Vietnam and Russia reached $3.63 billion in 2023, up 2.3 per cent on-year. In 2024, the figure hit $4.57 billion.

Vietnam’s main exports to Russia include mobile phones, electronic products, footwear, garments and textiles, and assorted ago-forestry-aquatic products. Vietnam’s key imports from Russia consist of coal, wheat, steel and iron, fertiliser, vehicles, machinery, and equipment.

VIR