The groundbreaking ceremony of the Duong River Surface Water Treatment Plant was held successfully on March 9 in Phu Dong Commune, Gia Lam District, Hanoi.
Just nine months earlier, this project was awarded an investment license by the Hanoi People’s Committee.
The project has a total investment of US$225 million for phase I, with the water treatment plant spanning over 62 ha, and the pipeline system, 76km.
Such a large-scale project requires a huge site clearance task and investment preparation workload.
The groundbreaking ceremony of the Duong River water treatment plant on Thursday was another evidence of Hanoi’s commitment and efforts in attracting and creating the best conditions for investors in the capital.
On his key note speech at the event, Mr. Nguyen Duc Chung, chairman of the Hanoi People’s Committee, urged the project to shorten the expected commercial operation date from 22 months to 19 months from groundbreaking, in order to quench the thirst for stable and clean water supply of Hanoi people.
With the current development, Hanoi’s demand for clean water is expected to reach 1.5 million m3/day-night by 2020, while the existing supply can only provide 0.9 million m3/day-night, resulting in a shortage of about 0.6 million m3/day-night. Moreover, the current water supply relies mostly on underground water that is not clean while surface water supply is limited and not stable. In this context, the construction commencement ceremony was a strong evidence for such commitments.
This significant water supply project aims to meet clean water need for about 3 million people in 168 communes in 8 districts of Hanoi, as well as Bac Ninh and Hung Yen provinces along Road 179 by 2020. In particular, the project aims to produce 150,000m3 of clean water per day-night by 2018 and 300,000m3 per day-night by 2020.
Mr. Nguyen Duc Chung, chairman of Hanoi People’s Committee shakes hand with H.E. Saif Hilal Al Mahrouqi, Omani Ambassador in Vietnam in the Construction Commencement Ceremony, in the witness of H.E. H.E. Abdul Malik Abdullah Zahir Al Hinai, representative Omani Government.
This is another high profile investment of Vietnam – Oman Investment (VOI) in its distinguished water portfolio in Vietnam.
VOI is a known authority in infrastructure investment in Vietnam, established from 2008 as a joint venture between two sovereign wealth funds of Oman and Vietnam: the State Government Reserve Fund (SGRF) of Oman and the State Capital Investment Corporation (SCIC) of Vietnam.
Capitalized on supports of the Governments of Vietnam and Oman, VOI has shown a strong long-term commitment in value investments in growth, reputed infrastructure projects and companies including power plants, toll roads, water supply, ports and logistics, etc.
In the water sector, VOI has so far launched one project in the Mekong Delta, the highest salt-marsh area in Vietnam, one project in Ho Chi Minh City and now this start-up project in Hanoi.
Risk appetite, VOI is one of a few private equity firms in Vietnam embarking on green-field or brown-field projects because of its distinguished local understanding and long-term commitment to realize the potential of such projects.
“We are very proud to have VOI as a joint founding partner”, said Ms. Do Thi Kim Lien, chairwoman of Duong River Surface Water JSC Company.
“Unlike other private equity firms, VOI has deep understanding of the water industry and has been enthusiastic in joining us even from the pre-feasibility study stage.
“Their deep experience with water projects in Vietnam has helped us a lot, especially in risk management and corporate governance during this green-field stage”.
Beyond being just another foreign financial investor, VOI positions as an active and responsible partner in the investee companies with value adding in not just technical but also institutional matters.
Mr. Le Quoc Binh, CEO of the Ho Chi Minh City Infrastructure Investment JSC (CII), one of the giant infrastructure consortiums in southern Vietnam, commented “VOI, as a sovereign fund from Oman, has a very high interest in economic-social development of Vietnam and has helped us a lot in corporate governance at both CII group and subsidiary level. If every private equity firm in Vietnam has such commitment and long-term vision like VOI, this would definitely bring a lot of benefit to Vietnam’s economic – social development.”
Presenting the Ministry of Finance of the Sultanate of Oman at the groundbreaking ceremony of the project, H.E. Abdul Malik Abdullah Zahir Al Hinai, said “We are happy with VOI performance so far for the economic development of Vietnam and Vietnamese people security. In the ceremony today, I see that VOI has had active contribution to the Vietnamese government to solve the urgent need for Vietnamese people for clean water. Such project is the evidence of the fruitful cooperation between the two Governments for better quality of life of people in both nations”.
As a symbol of strong economic tie between Vietnam and Oman, VOI is hoped to cash in the areas that tap critical needs of more than 90 million people to mark Vietnam as a highlight in the investment portfolio of the Sultanate of Oman.