Hyundai Oilbank announced on Nov. 6 that it has secured a 200,000-barrel petroleum product storage base in Ba Ria Vung Tau Province, Vietnam, to expand exports to Southeast Asia.
This is the first time a Korean oil refinery built a petroleum product storage base in Vietnam. Ba Ria Vung Tau Terminal is Vietnam's first private petroleum product terminal that allows foreign business operators to freely export imported goods. The terminal is adjacent to Ho Chi Minh City, Vietnam's economic hub. It is considered the best place for a petroleum product export base because large tankers can easily come alongside the terminal.
Hyundai Oilbank plans to foster Ba Ria Vung Tau Terminal as its Southeast Asian export hub. The company plans to increase exports and improve its profit structure through active direct transactions with Vietnamese state-run and private distributors, and direct sales agencies. The Vietnamese petroleum product market is growing at an annual rate of over 5 percent. In particular, Vietnam does not have enough refining facilities, so it meets 30 percent of its total demand with imports from other countries such as Singapore, Malaysia, and Thailand. The proportion of Korean products has been on the rise since the 2015 FTA between Korea and Vietnam.
Hyundai Oilbank plans to make a foray into Cambodia and Laos based on the storage base’s geographical advantages. These countries lack petroleum refining facilities and do not have large port facilities, so they mainly import petroleum products through Ba Ria Vung Tau. "Next year, we will more than double our exports, which are now around 3 million barrels a year," a Hyundai Oilbank official said. "Beginning in 2021, we will diversify our export products into petrochemicals and lubricants among others."