Messer is set to build the largest industrial gases production facility in Vietnam after signing a new supply deal with the country’s largest steel producer.
Under the contract with Hoa Phat Steel, Messer will construct two plants in the Dung Quat economic zone in southern-central Vietnam to supply oxygen (O2), nitrogen (N2) and argon (Ar) to the steelworks by pipeline.
The sites will produce 80,000 Nm3 of O2 and 160,000 Nm3 of N2 per hour, which corresponds to around five and ten road tanker loads respectively. Aside from supplying the steelworks, Messer will also provide liquid gases to the local market for its shipbuilding industry and automotive suppliers.
Messer will invest over $90m in the development. Both plants are due to start operations in November 2018.
The German industrial gas specialist generated sales of over €40m ($43m) in Vietnam last year, with owner and CEO Stefan Messer reinforcing, “By cultivating our partnerships and further increasing our supply of the local market, we’ve managed to generate impressively strong growth in Vietnam over the past year.”
Messer has a long business history with Hoa Phat Group dating back to 2007, when it invested $20m in a new air separation unit (ASU) to cover the needs of Hoa Phat Steel’s first integrated plant. Messer’s second plant then went into operation in 2012, increasing its capacity in Vietnam by around 150%.
The industrial gas manufacturer commissioned its third ASU in Vietnam at the Hai Duong site last year, producing 27,000 Nm3 of O2 and 54,000 Nm3 of N2 per hour.
Messer commands a share of approximately 22% in the Vietnamese gases market, according to gasworld Business Intelligence.