There is a trend that foreign corporations entering Vietnam market as they see the potentials of this rising economy. Japan’s Idemitsu Kosan Group has received an investment license to open a joint venture with a unit of Kuwait to build a petrol distribution system in Vietnam.
This corporation will contribute 50% capital to Idemitsu Petroleum Q8 Co., Ltd, along with Kuwait Petroleum International (KPI) to set up station system to retail gasoline in Vietnam.
The investment registration license has been granted by the Vietnam Government and the business registration procedures are being conducted. If completed, this would be the first time when Vietnam petroleum distribution market has the participation of an enterprise with 100% foreign capital.
Currently, the two partners in the joint venture of Idemitsu Petroleum Q8 are all shareholders in Nghi Son Petrochemical Complex and Vietnam Oil and Gas Corporation (each party hold 35% of the capital).
Nghi Son Petrochemical is expected to trial operating in 2016 and commercial operating in 2017. Thus, through the establishment of a separate company on the distribution of petroleum products, Idemitsu and KPI will complete the production and distribution chain in Vietnam, ensuring the supply as well as output for the product.
Apart from the investment in joint venture distribution and petrochemical company, Idemitsu Kosan is also engaged in a series of beginning stage projects of the petroleum industry, such as investment in the mining lots (Lot 09-3, Lot 05.1). Moreover, this Japanese giant also said that they are ready to consider contributing funds when PV Oil carries out equitisation.
Idemitsu Kosan is one of the leading oil and gas group in Japan, with history of over 75 years of formation and development. The group’s market capitalization has now reached 108.6 billion Yen (almost 1 billion USD) with net sales in 2014 reached 4,630 billion Yen (about 42 billion USD). By the end of the first quarter of 2015, the corporation has nearly 9,000 employees.