Vietnamese state-held power generation company Electricity of Vietnam (EVN) has signed a long-term coal supply contract with the domestic coal producer Vietnam Coal and Mineral Industries Holding Joint Stock Corporation (Vinacomin). The deal will enable EVN to avoid electricity shortages and receive sufficient coal supplies for its thermal power plants.
Vinacomin was established in 2005 by the merger of the Vietnam Coal Corporation (Vinacoal) and Vietnam Minerals Corporation. It accounts for 95% of Vietnam's total coal production and provides coal for the domestic power sector. Vinacomin produces around 8.5 Mt/year from its Vang Danh, Uong Bi and Nam Mau coal mines, about 3 Mt of which are grades that are not used domestically.
The Vietnamese government has predicted that the domestic coal demand for domestic production will increase significantly by 2020 but the domestic production is expected to meet only about 50% of the demand, which means that imported coal volumes are expected to ramp up as well. Even though Vinacomin will remain EVN's primary supplier, EVN will also increase its imports from countries such as Indonesia and Australia.