Russian state-owned oil firm Zarubezhneft has entered an agreement with Belgian contractors Deme Concessions to develop an up to 1GW Vietnamese offshore wind project, according to media reports.
They plan to develop the offshore wind farm alongside their subsidiaries Deme Offshore Company and Vietsovpetro – a joint venture of Zarubezhneft and Vietnamese energy company PetroVietnam.
The 1GW of capacity would be divided into two phases, with a 600MW first phase and 400MW second phase, according to Vietnam Economic News.
The partners have not decided on a precise location for the project, but it is likely to be built off Binh Thuan or Ba Ria-Vung Tau — two neighbouring provinces in the south of the country.
A timeline for the project has not been set either, but the developers believe the first phase could be online by 2026.
Vestas is the main bidder to supply turbines, following an agreement in 2018.
Russian analysts estimate the project could need $800 million of investments. This funding is likely to come from Zarubezhneft as well as Russian banks.
Zarubezhneft aims to reduce its carbon footprint, but has not set out a firm plan for doing so.
While Russian oil companies are not as actively investing in wind power energy as global majors,their interest in such projects has increased significantly in recent years.
For example, in June, Rosneft announced its plans to build several wind farms together with Vestas Rus – in a move to ensure regular energy supply to Rosneft's facilities.
That same month, Novatek also agreed to buy green electricity from Fortum's wind farms to power its LNG (liquefied natural gas) plant in Vysotsk. It had previously considered building a wind farm in the Yamal peninsula in north-west Siberia.