Coal Mine Methane Country Profiles - Global Methane Initiative

37 VIETNAM
37.1 Summary of Coal Industry
37.1.1 ROLE OF COAL IN VIETNAM
Coal accounted for 12 percent of Vietnam’s electricity generation in 2007 (EIA, 2007). Although
Vietnam has historically relied on hydropower for electricity, coal-fired power plants are expected to
eventually account for 25 percent of Vietnam’s total electricity production. Vietnam suffered a shortage
of electricity of 8–10 Terawatt-hours in 2008–2009. By 2020, the shortage could be 115–225 Terawatthours
(Baruya, 2010). Vietnam Electricity (EVN), Vietnam’s national electric utility has plans to build 17
new coal-fired power stations by 2020 (EIA, 2007).
The country’s coal reserves, as shown in Table 37-1, are estimated at 150 million tonnes (Mmt), with
almost all of the reserves as anthracite. Since the 1980s, Vietnam has become a major player in coal
production in Southeast Asia. In 2004, Vietnam ramped up production to 16.42 Mmt, which was
approximately 42 percent more than in 2000. Coal production for 2005 increased further, raising the total
to 32.4 Mmt. In 2008, coal production reached 39.9 Mmt (EIA, 2009). Vietnam exported 4.5 Mmt of
coal, primarily to Japan and China, in 2002. This number increased to approximately 15 Mmt in 2005;
however, the country is expected to decrease these exports in coming years (Phuoc Ha, 2006). Other
export markets for Vietnamese coal include Thailand, the European Union, Mexico, and Brazil.
Table 37-1. Vietnam’s Coal Reserves and Production
Indicator
Anthracite &
Bituminous
(million tonnes)
Sub-bituminous
& Lignite
(million tonnes)
Total
(million tonnes)
Global Rank
(# and %)
Estimated Proved Coal
150 0 150 48 (0.02%)
Reserves (2005)
Annual Coal Production (2008) 39.9 0 39.9 19 (0.6%)
Source: EIA (2009)
Most of Vietnam’s coal resources are located in the north. The Quang Yen anthracite region basin, east of
Hanoi near the Red River Delta, is the central mining area where coal deposits cover a total area of 3,500
square kilometers (km 2 ). These deposits are estimated to be 190–272 billion tonnes, lying 250–1,200
meters beneath the basin. The dip makes about half of it suitable for surface mining while the other half
must be deep mined. Plans for 2010 include beginning pilot projects to exploit the reserves of the Red
River Delta Basin (Omdahl et al., 2009). Figure 37-1 below shows Vietnam’s coal resources.
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Figure 37-1. Vietnam’s Coal Resources
Source: Baruya (2010)
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37.1.2 STAKEHOLDERS
Vietnam’s coal mining industry is owned and operated by the state coal mining company, Vinacomin
(Vietnam National Coal and Mineral Industries Group), which was created by the merger of the Vietnam
Coal Corporation (Vinacoal) and Vietnam Minerals Corporation. Vinacomin operates 100 percent of all
coal mines.
Table 37-2. Key Stakeholders in Vietnam’s CMM Industry
Stakeholder Category Stakeholder Role
Mining companies • Vinacoal Project hosts
Equipment Manufacturers • Vietnam Research Institute of Electronics, Informatics and
Automation
Universities, Research
Establishments
• Institute of Mining Science and Technology, Hanoi,
Vietnam
• University of Mining and Geology, Hanoi, Vietnam
Technical assistance
Regulatory Agencies and
Government Groups
• Vinacoal
• PetroVietnam
• PetroVietnam Exploration Production Corporation
37.1.3 STATUS OF COAL AND THE COAL MINING INDUSTRY
Project identification
and assessment support
Coal production from underground mines in past years has reached 30–35 percent of capacity and will
increase in the coming years. As of 2009, Vietnam had 20 underground mines, seven of which have an
annual production capacity of more than 1 Mmt. The remaining underground mines have an annual
capacity between 300,000 and 800,000 tonnes per mine (Omdahl et. al., 2009). Vietnam is seeking to
increase production of its deeper anthracite reserves for high-quality export grade coals, as well as for its
expanding coal power sector. Purchases of heavy mining equipment from Australia have enabled the
expansion of existing underground mines and development of new underground mines.
Some of Vietnam’s surface mines have been closed; however, 29 remain open. Six surface mines have an
annual production capacity from 0.8 to 1.5 Mmt per mine. The remaining mines each have an annual
capacity of 200,000–400,000 tonnes (Omdahl et.al., 2009).
As of 2008, Vietnam had 27 total thermal power plants, 10 of which are coal-fired and 13 are gas-fired.
Coal-fired plants include Na Duong (110 megawatts [MW]), Cao Ngan (110 MW), Cam Pha (two 340-
MW) and Son Dong (220 MW). Vietnam has plans to build an additional 12 thermal power plants in the
northern economic regions by 2015. Coal-fired plants currently under construction include Mao Khe (220
MW) and Nong Son (30 MW). Vietnam plans to import coal to meet power demand after 2011 (Omdahl
et. al., 2009).
37.2 Overview of CMM Emissions and Development Potential
The Global Methane Initiative (formerly Methane to Markets Partnership) International CMM Projects
Database currently identifies no CMM projects; however, the coalbed methane (CBM) industry is
emerging in areas where mining is poised to take place, and thus may evolve into CMM projects as CBM
activity intersects with mining.
A recent study of Vietnam’s 25 gassy hard coal mines was commissioned to determine gas content of
coals and to forecast methane release into the mines. Seven mines were classified as especially gassy. The
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results of the forecasts and a study of the capacities of these mines’ ventilation systems are being used to
estimate the amount of methane that may be captured by drainage systems. Additionally, the gassiest
mine, Mao Khe, was equipped with an automatic methane content measurement control system (Somers,
2010).
37.2.1 CMM EMISSIONS FROM OPERATING MINES
With increasing coal production and the mining of deeper seams, CMM emissions in Vietnam have also
increased. Table 37-3 summarizes Vietnam’s CMM emissions.
Table 37-3. Vietnam’s CMM Emissions (million cubic meters)
Emission Category 1990 1994 1995 2000 2005 2010
(projected)
Total Emissions from Underground Coal Mines 49.80
Total Emissions from Surface Mines 3.18
Total liberated 52.98
Recovered & Used 0
Total emitted 32.4* 52.98 58.5* 69.7* 83.2* 99.3*
Source: UNFCCC (2003); *USEPA (2006)
37.2.2 CMM EMISSIONS FROM ABANDONED MINES
No information relating to recovery or use of CMM from abandoned mines was found.
37.2.3 CBM FROM VIRGIN COAL SEAMS
A number of potential areas for CBM development exist in Vietnam. The Red River Basin is an
economically important area of northern Vietnam. The area has coal deposits lying at depths of 250–
1,200 meters spread over a 3,500 km 2 area. Gas content of the basin’s sub-bituminous coal is estimated at
0.94–1.6 m 3 per tonne (30–50 standard cubic feet [scf]/ton), with conservative resource estimates ranging
from 170 to 280 billion m 3 (6–10 trillion cubic feet [Tcf]). Another area of interest is the Quang Yen
Basin, which extends over 200 kilometers (km) from east to west in northeast Vietnam and covers
approximately 5,000 km 2 . Though yet undetermined, CBM and CMM potential of this area is a target for
study (Thai, 2008).
Most of Vietnam’s CBM activity to date has been confined to the Red River Basin. Keeper Resources has
been working on the first CBM extraction projects. The negotiated CBM concession with PetroVietnam
and PetroVietnam Exploration Production Corporation (PVEP) covers approximately 3,600 km 2 of the
Red River Basin to the southeast of Hanoi. Three years of negotiations were concluded with the signing
of a CBM Production Sharing Contract (PSC) in early 2010. The project proceeded with the signing of
drill site construction and preparation contracts after acquiring land access approvals (Dragon Capital,
2008; Dragon Capital, 2010). A scoping study of the CBM potential in the Red River Basin
commissioned by Keeper estimated prospective gas resources to be 55 billion m 3 in the study area, which
represents 28 percent of Keeper’s concession (Keeper, 2005).
In addition, Arrow Energy has signed a PSC with PVEP in a CBM concession of 2,743 km 2 in the Red
River Basin. The PSC requires Arrow to drill eight wells on the block. Exploration drilling began in
January 2009 (Arrow, 2009).
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37.3 Opportunities and Challenges to Greater CMM Recovery
and Use
Vietnam is a signatory to both the UNFCCC and the Kyoto Protocol (see Table 37-40). As a Non-Annex I
Party to the Kyoto Protocol, it has no national emissions targets and is eligible to host mitigation projects
under the Clean Development Mechanism.
Table 37-4. Vietnam’s Climate Change Mitigation Commitment
Agreement Signature Ratification
UNFCCC June 11, 1992 November 16, 1994
Kyoto Protocol December 3, 1998 September 25, 2002
Source: UNFCCC (2010)
37.3.1 MARKET AND INFRASTRUCTURE FACTORS
No information pertaining to market and infrastructure barriers could be sourced from the Vietnamese
Ministry of Natural Resources and Environment website or the Ministry of Industry and Trade’s website,
as of June 2010. However steady and increasing coal mining as well as increased demand for natural gas
makes CBM and CMM attractive in Vietnam. Coal mining is poised to continue escalating in Vietnam to
meet the demand of 200 Mmt by 2020 (MONRE, 2010a). There have also been recent discussions within
the country surrounding the use of natural gas to fuel additional power plants as well as the use of natural
gas in the form of compressed natural gas (CNG) to operate vehicles (MONRE, 2010b; MONRE, 2010c).
Between 2008 and the first half of 2009, Vietnam commissioned 5 GWe of new electric capacity, much
of which was gas-fired (2.7 GWe) (Baruya, 2010). Currently, natural gas is not commonly used outside of
the industrial and power generation sectors (EIA, 2007).
37.3.2 REGULATORY INFORMATION
Vietnam’s natural gas sector is dominated by the state-owned Vietnam Oil & Gas Corporation,
Petrovietnam, which is under the control of the Ministry of Industry (EIA, 2007). Current CBM activity is
conducted through production sharing contracts.
Coal production in Vietnam exceeded growth expectations from 2001 to 2005. Various sources have
reported that the Vietnamese government would like to slow this growth and retain coal reserves for
domestic utilization.
37.4 Profiles of Individual Mines
The Vietnam Coal Corporation reports coal reserves of 6.5–7 billion tonnes in the Quang Nimh coalmine
(Phuoc Ha, 2006); however no information regarding CMM projects could be obtained. Updates on future
CMM projects in Vietnam can be found at
http://www.methanetomarkets.org/coalmines/index.htm#profiles.
37.5 References
Arrow (2009): Vietnam – Arrow Energy. http://www.arrowenergy.com.au/page/Projects/Vietnam/
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Baruya (2010): Prospects for Coal in Vietnam. Paul Baruya, IEA Clean Coal Centre. CCC/164, ISBN 978-92-9029-
484-9, February 2010. http://www.iea-coal.org.uk/site/ieacoal/publications/newsletter/current-issue/prospectsfor-coal-in-vietnam
Dragon Capital (2008). Vietnam Resource Investments. Dragon Capital Markets Limited Monthly Report March
2008. http://www.dragoncapital.com/UserFiles/File/monthly%20report/2008/Mar/MR_200803VRI.pdf?PHP
SESSID=e1fc9daa1d3bfa3ae589ab41f43ad982
Dragon Capital (2010): Vietnam January 2010 Update. Dragon Capital Markets Limited. January, 2010.
http://www.dragoncapital.com/UserFiles/File/monthly%20report/2010/Jan/MR_201001.pdf
EIA (2007): Vietnam Country Analysis Brief, U.S. Energy Information Administration, July 2007.
http://www.eia.doe.gov/emeu/cabs/Vietnam/Full.html
EIA (2009): International Energy Statistics. U.S. Energy Information Administration, Independent Statistics and
Analysis. 2009. http://tonto.eia.doe.gov/cfapps/ipdbproject/IEDIndex3.cfm
IEA (2007): International Energy Agency Energy Statistics – Coal. International Energy Agency, Paris, France,
table posted at http://www.iea.org/Textbase/country/index.asp
IEA Coal Research (1983): Concise Guide to World Coalfields, IEA Coal Research, London, 1983.
Keeper (2005): Vietnam CBM Review. Keeper Resources. 2005.
http://www.keeperresources.com/Vietnam%20CBM%20Review.pdf
MONRE (2010a): Coal sector urged to ensure occupational health and safety. Viet Nam Ministry of Natural
Resources and Environment. January 25, 2010.
http://www.monre.gov.vn/monreNet/Default.aspx?tabid=256&ItemID=79305
MONRE (2010b): US offers to help Vietnam exploit gas reserves. Viet Nam Ministry of Natural Resources and
Environment. March 19, 2010. http://www.monre.gov.vn/monreNet/Default.aspx?tabid=256&ItemID=81570
MONRE (2010c): Greater government support needed for natural gas. Viet Nam Ministry of Natural Resources and
Environment. April 2, 2010. http://www.monre.gov.vn/monreNet/Default.aspx?tabid=259&ItemID=82302
Omdahl et. al. (2009):Vietnam’s Coal, Mining, and Coal-fired Power Generation. Brent Omdahl, Nguyen Dzung,
and Jason Card, U.S. Embassy Hanoi, Vietnam, presented June 10, 2009, available from United States
Commercial Service, United States Department of Commerce. http://www.buyusa.gov/vietnam/en/259.html
Phuoc Ha (2006): Vetnamnet Bridge. http://english.vietnamnet.vn/biz/2006/09/608994/
Somers (2010): Coal Mine Methane Project Opportunities: Globally and in Viet Nam, Jayne Somers and Charlee
Boger, presented at Advanced Mining for Sustainable Development, Ha Long Bay, Viet Nam September, 2010.
Thai (2008): Coal Bed Methane in Vietnam is Hot. Thai Son Do, Research Associate, Energy & Power Systems
Practice, Frost & Sullivan. August 7, 2008. http://www.frost.com/prod/servlet/market-insighttop.pag?docid=140182389
UNFCCC (2003): Socialist republic of Viet Nam, Ministry of Natural Resources and Environment: “Vietnam Initial
National Communication” 2003. p. 18, 27–28. http://unfccc.int/resource/docs/natc/vnmnc01.pdf
UNFCCC (2010): Ratification Status, accessed June 15, 2010.
http://maindb.unfccc.int/public/country.pl?country=VN
USEPA (2006): Global Anthropogenic Non-CO 2 Greenhouse Gas Emissions: 1990–2020, Draft, U.S.
Environmental Protection Agency, Office of Atmospheric Programs, Climate Change Division, June 2006.
Available at: http://www.epa.gov/nonco2/econ-inv/international.html
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