Difficulties in Developing Petroleum Industry in Vietnam

Difficulties in Developing Petroleum Industry in Vietnamby Nguyen Duc Anh Tuan entreNowadays, in the deviseing era with fast pace, those agricultural countries, particularly Vietnam, king non entirely focus on improving the agriculture still excessively pay attention to developing the industrial ara. More specific solelyy, Vietnam has been concentrating on how to develop the bollocks up and embrocate patience recently. However, the country is still face up a circle of difficulties. This essay pass on discuss in skill or so what are the problems and point out the potential causes for those challenges base on three questionsWhat are the reasons causing difficulties for the development?What are the effects of these problems for Viet Nam?What are possible solutions to resolve these problems?Definition of anoint and bollocks agree to the Vietnam fossil oil and Gas Law (1993) rock oil and bluster means crude oil, ingrained botch and hydrocarbons in bollix upeous, liq uid or solid in its born(p) province except coal, shale, bitumen or other minerals digest be extracted oil. Oil and drift activities is active exploration, development and mining of petroleum, including direct suffice activities for these activities. there are many oil and gas activities dividing into different theater of operationss.Situation of petroleum manufacturing in Viet NamThe petroleum industry contributed most amount of opposed currency to serve the economy as electricity and gas, gasoline and loot energy. Recently, the National Oil and Gas Group Vietnam (PVN) has provided nearly 35 million m3 of dry gas takings, 40% of national electricity production, 35-40% urea entreat and total 70 % of LPG demand for industrial development and consumer welfare. Raw oil export has a strong growth and stability, greatly contributes to country exports, peculiarly in earlier periods, averaging some 15%. Currently, this proportion has decreased and exactly at about 7.5. Alt hough total exports are declining but oil and gas industry is still keeping the unit contribution at about 18-22% of total national GDP. (tapchitaichinh.vn, 2012)Causes and effects causing difficulties for the developmentFirst of all, it fundament be denied that there has been a miss of technology which put gas and oil industry of Vietnam under difficulty. After a unyielding cadence being an agriculture focus country, Vietnam has decided to change and transform into an industrial country. Obviously, that decision may lead to the fact that the country susceptibility lack skills and technology to adapt to this industry. One of the main weaknesses of our country is that the government might not have enough capital to invest into developing and update technologies. Prices of various types of equipment, supplies, fuel and services primarily are relate to production and business activities which make investments more complicated.Vietnam oil and gas industry straight off is quite yo ung with limited tender-hearted resource capacity to supply so that it cannot meet demand. Our country mainly exports crude oil and imports slap-up oil to serve local demand. There are some refineries that went into work as the Dung Quat oil refinery, Nghi Son refinery but only supply about 35% of domestic demand. Meanwhile, demand for petroleum products is increasing, not only in the short term but in the extensive term due to the population explosion and the continuous growth of the industry, curiously the acceleration of the transport sector needs to do more According to OPEC, demand for petroleum fuels is increasing rapidly, especially in developing countries, and by 2025, the supply go out not meet the demand. Moreover, increasing oil prices also have a tremendous impact on the development of this industryThose reasons above have led to human resource in gas and oil industry became more expensive. That led to the significant increase in the number of people who wish to work in the oil and gas sector. Many students said that they are studying the oil industry not only because of higher salaries, simply because of the fact that oil industry is considered to be the solutions for the future of the energy industry. However, Vietnam labor market is a serious unstableness between sectors and areas. We have abundant unskilled labor and a lot of labor who have shortage of Technical Skill.According to Mr. Hoang Nhat Thong (Office of the popular Department of Sea and Islands), the economy in commonplace marine, oil and gas industry in particular, is a severe manpower shortage will affect only the maritime economy and coastal contribute about 53-55% of the total GDP of the country in 2020. Urgent solutionsOil and gas industry is the field has to combine all of those technologies and sciences like astronomy, tides, marine sciences, manifestation and installation of offshore structures such as rigs, pipelines, tanks, drilling into the ground, the work of g eology, geophysics, exploration of the stratigraphy Therefore, the application of science and technology in the oil and gas activities can image high efficiency, save natural resources, enhance oil recuperation factor and other resources saving as well as treasure ecological resources.Therefore we have to build human resources management trunk according to international standards, which include the application of information technology systems, social occasion capabilities, the standard title, system evaluation, payment regulation, bonuses, rules and criteria for recruitment to appoint the head, proper preparation and appropriate building standards, criteria representatives and representatives of Petro Vietnam stake in the oil and gas activities in the country and foreign pilot who runs accordance with the Law on Enterprises. For revenue enhancement policy should define equality between domestic service with service by foreign companies perform as VAT, import duty, It should have exceed policies and encourage oil and gas activities in the deep water offshore exploration and exploitation of natural gas tax policy should be adjusted based on the refinery and in the planning to compete with import products, policies for gas and electricity prices should approach the market mechanism.Have appropriate policies related to arrange key capital projects through Grant, loan guarantee and ensure currency converter to facilitate in arranging loans for major projects the state level, support preferential loans from the Development Bank minimum of 20% to 30% of total investment projects focus on oil and gas.(Pvcfc.vn, 2014)EvaluationObviously, to develop gas and oil industry, it is important to fully invest in all areas however, all of those solutions have pros and cons themselves. All of the above mentioned solutions usually take long time and a lot of money to consider, improve and implement, especially put in technologies and human resources. However, once thos e two are on set, they will have a great impact on this industry. Besides that, likely they do not take as much time as changing the countrys policy since it is much harder to change the social unit countrys system. Finally, maybe gas and oil industry should go with technologies first since it is mandatory for such an industry.Regarding to human resources, we recently identified human resource as one of the most important factors to make decisions in production and business activities as well as drive withdraw development of any society, particularly in the oil and gas industry it is also reflected in the work environment , in terms of general science, technology, international environment and different cultures.ConclusionEven though it is opened to say that gas and oil industry is still facing a lot of challenge if the government of Vietnam wants to develop this kind of industry more. In that case, they should consider about how to raise enough capital to invest in equipment, t o cover potential loss and to recruit right people. However, it cannot be denied that this area of industry is very attractive for investor therefore Vietnam can also want for big investment from foreign country to develop gas and oil industry.Referencesmoj.gov.vn (1993), Lut du kh nm 1993 (online). functional at http//www.moj.gov.vn/vbpq/Lists/Vn%20bn%20php%20lut/View_Detail.aspx?ItemID=10817 Accessed 24 Dec 2014Nang Luong Viet Nam (2014), Ngnh Du kh Vit Nam trc thch thc an ninh nng lng quc gia (online). operable at http//nangluongvietnam.vn/news/vn/dau-khi-viet-nam/nganh-dau-khi-viet-nam-truoc-thach-thuc-an-ninh-nang-luong-quoc-gia.html Accessed 19 Dec 2014Pvcfc.vn (2014), Chin lc pht trin ngnh Du kh n nm 2020 Nhng gii php c bn (online). unattached at http//www.pvcfc.com.vn/article-detail.aspx?id=41 Accessed 18 Dec 2014tapchitaichinh.vn (2012), Ngnh Du kh Vit Nam Tim nng ln, tng trng cao (online). 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