1 AIT Asian Institute of Technology

Netback value of natural gas and its financial implications for the power sector in southern Vietnam

AuthorHoang Tieu Dung
Call NumberAIT Thesis no. ET-98-2
Subject(s)Natural gas--Vietnam--Economic aspects

NoteA thesis submitted in partial fulfillment of the requirements for the degree of Master of Engineering, School of Environment, Resources and Development
PublisherAsian Institute of Technology
AbstractNatural gas is a commodity, which is consumed by end-users like power or urea producers and produced by oil and gas exploration and production companies. Consumers want to buy gas at a price as low as possible. They never buy gas at a price higher than its value for them. Producer want to sell gas at a price as high as possible. They never sell gas at a price lower than their production cost. Being the main gas consumer in Southern Vietnam (SV), power producers should lmow the gas value for them in production electricity by whole power system (PS). This netback value of natural gas (NBVng) plays an important role to keep Vietnamese partners' rationale in gas sale/purchase contracts negotiation, which is pending for more than two years. NBVng reported in some books/documents are defined by traditional market-related approach, which takes into account only one particular thermal plant switched on gas-fired use. In this study, NBVng is determined by using WASP-III, which gives the least-cost expansion generation plan for SVPS. NBVng is calculated in different scenarios with changing gas volume, fuel price, discount rate, plant's efficiency and gas heat value. NBVng for SVPS varies in a wide range from 2.56 to 4.4 $/MMbtu. NBVng increases with increasing efficiency, heat value, price and discount rate. NBVng decreases only with increase in gas volume. In this study generation cost and its savings from gas usage has also been calculated. Saving of billions of US$ can be made for SVPS by switching from other fuel to gas. Both Vietnamese and foreign partners can have big benefits by developing gas. That leads to the following conclusion: NG should be used in SVPS as soon as possible and as much as possible.
Year1998
TypeThesis
SchoolSchool of Environment, Resources, and Development (SERD)
DepartmentDepartment of Energy and Climate Change (Former title: Department of Energy, Environment, and Climate Change (DEECC))
Academic Program/FoSEnergy Technology (ET)
Chairperson(s)Pacudan, Romeo;
Examination Committee(s)Lefevre, Thierry ;Malik, Arif Saeed ;Savin, Daniel V.;
Scholarship Donor(s)Government of France ;
DegreeThesis (M.Eng.) - Asian Institute of Technology, 1998


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