DECISION

RATIFYING THE CEMENT INDUSTRY DEVELOPMENT PLAN IN VIETNAM FOR THE PERIOD 2011 - 2020 WITH VISION TO 2030

THE PRIME MINISTER

Pursuant to the Law on Government Organization dated December 25, 2001;

Pursuant to the Law on Construction No. 16/2003/QH11 dated November 26, 2003;

Pursuant to the Law on Minerals No. 60/2010/QH12 dated November 17, 2010;

Pursuant to the Government’s Decree No. 92/2006/ND-CP dated September 7, 2006 on preparing, ratifying and managing the general socio-economic development plan;

Pursuant to the Government’s Decree No. 124/2007/ND-CP dated July 31, 2007 on management of building materials;

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HEREBY DECIDES

Article 1. To ratify the cement industry development plan in Vietnam for the period 2011 - 2020 with vision to 2030 with the following main contents:

1. Development viewpoints

a) Investment:

Invest in the sustainable development of the cement industry, make a significant contribution to the socio-economic development, promote rational use of natural resources, protect ecological environment, cultural relics, historical remnants, scenery as well as ensure national security and defence. Prioritize cement projects to be executed in Southern provinces, cement facility expansion projects; high capacity, modern technology, material and energy efficiency projects. Cement projects that belong to the list of investment projects enclosed in this Decision shall only be allowed for investment and development in terms of construction of cement grinding facilities with the manufacturing capacity corresponding to that of clinker combustion chambers. Investment in development of independent or separate cement grinding stations shall not be allowed either.

b) Technology:

- Apply advanced technologies with the high level of mechanization, high material and energy efficiency during the manufacturing process. Select proper equipment in order to ensure stable production, high quality products, reasonable cost prices and promote the competitiveness under regional and international economic integration conditions. Invest in the synchronization of facilities and systems by making best use of thermal emissions for power generation purposes, specifically as follows:

+ New cement investment projects (entering into the contract for supply of equipment from the date of this Decision's entry into force) with the capacity of combustion chamber equal to 2,500 tonnes of clinker/day or more must be immediately equipped with systems and equipment that help utilize thermal emissions for power generation purposes, except for cement production lines powered by industrial wastes and sewage; with regard to currently operating cement plants and cement projects which are already underway but have had the contract for supply of equipment before the date of this Decision’s entry into force, they are required to have such investment activity completed by 2015.

+ As for cement plants with the capacity of below 2,500 tonnes of clinker/day, investment in system and equipment utilizing thermal emissions for power generation purposes should be studied and encouraged.

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- By the end of 2015, complete transformation of cement production technology from vertical shaft kilns to rotary kilns.

c) Production capacity:

Develop cement plants with high capacity and new investment projects with the minimum capacity of 2,500 tonnes of clinker/day. As for projects located at remote and underprivileged areas and projects for transformation from vertical cement shaft kilns to rotary cement kilns, the proper production capacity should be chosen.

Encourage the foundation of large cement production complexes derived from existing projects by taking appropriate forms.

d) Planned development zone:

Prioritize investments in cement projects located in Southern provinces and areas which are rich in raw materials, have favorable conditions for industrial development and meet rigorous standards for transport infrastructure.

Restrict investments in cement projects located at areas short of materials, or those causing negative impacts on cultural relics and tourism development.

2. Development objectives:

Orientate Vietnam's cement industry towards industrialization, modernization and sustainability with application of advanced technologies and manufacture of products that meet quality standards, market demands; save energy, materials and fuels; protect environment and scenery.

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a) Raw materials:

Sources of materials used by cement projects must be defined in the scheme for exploring, extracting and using minerals as cement products and have resource reserve that can ensure continuous manufacture for the period of at least 30 years.

Material sources must be used in absolutely economical and effective manners by employing the following methods: mineral exploitation, at-depth mining, or mineral extraction by applying tunnel boring technology; set up the plan for rehabilitation of completed mine areas and for scenery and environmental protection.

b) Technical criteria:

Cement plants must conform to technological requirements and reach high levels of mechanization and automation; have low labor costs; consume less electric energy and fuels; discharge small amount of dusts and economize on fuels.

Several criteria are specified as follows:

- Thermal energy consumption: ≤ 730 Kcal/kg clinker;

- Electric energy consumption: ≤ 90 Kwh/tonne of cement;

- Discharged dust volume: ≤ 30 mg/Nm³.

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- Demonstrate financial competence (minimum percentage of the owner's equity required to equal 20% of investment outlay), and set up the machinery for commencing and executing projects on schedule.

- Strictly and sufficiently comply with general regulations and project requirements according to the approved plan.

- Prepare annual project progress reports for submission to the provincial People’s Committee and the Ministry of Construction.

d) Project’s demands and list of projects:

- Forecast of demands:

Year

Cement demand (million tonne)

2011

54 - 55

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75 - 76

2020

93 - 95

2030

113 - 115

- The list of cement projects planned for operation for the period 2011 - 2015 and those planned for investment from 2016 to 2030 shall be specified in the Appendix I enclosed herein.

4. Solutions:

Call for the coherent cooperation between production and consumption as well as between industries or sectors, including mechanical engineering, transportation, natural resource, science and technology, education and training, and infrastructure development, etc. in order to meet demand for cement industry development and also encourage other industry development.

Enhance domestic mechanical engineering capability in order to meet the demand for cement industry development on time. In the meantime, manufacture non-standard equipment, components and spare parts to meet the demand for repair, reduce import rate and move towards researches to design synchronous devices used for cement production lines.

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Article 2. Implementation

1. The Ministry of Construction:

- Announce, disseminate and organize activities to implement and inspect the implementation of the plan approved by the Prime Minister;

- Annually, based on the current status of economy, society, market supply - demand, actual project execution according to the stated plan, send reports and proposals to the Prime Minister to request his consideration and decision regarding regulatory and policy system, solutions to demand stimulus, market stabilization; amend and supplement the list of projects that ensure the feasibility and sustainable development of cement industry; review and adjust the progress of projects specified in the approved plan in order to balance the demand and supply.

- Preside over, cooperate with the Ministry of Natural Resources and Environment in conformity with requirements regarding environmental issues that may arise from the manufacture of cement, restriction on negative impacts on scenery and ecological environment; suggest approaches to rational use of land and mineral resources;

- Preside over, cooperate with the Ministry of Science and Technology and the Ministry of Natural Resources and Environment in conducting researches that assist in establishment of the product quality system in accordance with the international standard; issue limits on raw materials, environmental standards and regulations; check requirements regarding technologies applied to cement projects which ensure environmental protection;

- Preside over, review the scheme for exploring, extracting and using minerals as cement products before reporting to the Prime Minister to apply for his approval of possible amendments or modifications; prepare the plan for investigation and research on extraction of material sources to meet requirements for cement industry development;

- Expedite the transformation to vertical shaft kiln cement plants.

2. The Ministry of Natural Resources and Environment:

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- Grant permissions for mineral activities for projects that have demonstrated their proper progress and manufacturing stage; introduce measures to bind cement material mining companies to apply advanced mining, exploitation techniques and maintain safety and environmental and scenery protection.

3. The Ministry of Industry and Trade:

Preside over and cooperate with the Ministry of Construction and relevant Ministries or industries in directing execution of mechanical engineering programs in order to study, design and invent appliances, spare parts and non-standard equipment used in cement production lines.

4. The Ministry of Transport:

- Review, adjust and plan implementation of the proper transport plan at cement plant-populated areas, even including road, rail and waterway transport, clinker and cement product handling ports;

- Preside over and cooperate with the Ministry of Construction in using cement products in these projects for building roads; prepare and introduce, within its jurisdiction, or request competent authorities to introduce technical standards for cement concrete roads which are applicable to national, provincial and express highway projects.

5. The Ministry of Education and Training:

Set up the plan to train workforce classified by majors: silicate, building material, building material mechanical engineering and automation to meet the demand for development of cement industry and others.

6. The Ministry of Science and Technology:

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- Collaborate with the Ministry of Construction in studying any modification and improvement of cement standards (11^th revised version) in conformity with development requirements.

7. The Ministry of Planning and Investment:

Research and propose regulatory systems to assist the development of cement industry.

8. The Ministry of Finance:

- Ponder over the introduction within its jurisdiction, or request the introduction of regulatory system regarding tax for the purpose of natural and mineral resource administration;

- Request the Government’s approval of encouragement and incentive policies on corporate credit and income tax imposed on cement plants when allowing investment in equipment that help utilize thermal emissions for power generation purposes and use industrial wastes and sewage as fuels for cement production.

9. The State Bank of Vietnam:

Direct commercial banks to consider arranging loans to finance cement projects specified in the approved plan and ensure capital of the project owner account for 20% of investment outlay of specific projects; not to consider cement projects that fall outside of the plan.

10. Vietnam National Cement Association:

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11. Vietnam Cement Industry Corporation:

- Play a key role in stabilizing cement production and consumption across the nation;

- Take urgent measures ordered by the Government to stabilize nationwide cement market.

12. The People’s Committee of centrally-affiliated cities and provinces:

- Direct competent affiliated authorities to rigorously carry out administration and execution of cement investment projects throughout localities in accordance with the approved plan, including the following contents: grant of Investment certificates, land allotment, land expropriation, compensation and site clearance, and residential resettlement according to the specified project progress, legal regulations, and follow other legal procedures regarding investment in cement projects according to the approved plan;

- Upon approving new local cement investment projects to be executed, apply for written consents from specialized Ministries (the Ministry of Construction);

- Cooperate with the Ministry of Construction in directing the work of commencing and executing cement projects located within their local areas according to contents stipulated by this Decision.

Article 3. This Decision shall enter into force from the signature date and replace the Prime Minister’s Decision No. 108/2005/QD-TTg dated May 16, 2005.

Ministers, Heads of Ministry-level agencies, Heads of Government agencies, and Presidents of the People’s Committees of centrally-affiliated cities and provinces, and Heads of relevant agencies, shall be held responsible for implementing this Decision.

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PP. THE PRIME MINISTER
THE DEPUTY PRIME MINISTER




Hoang Trung Hai

APPENDIX I

LIST OF PROPOSED CEMENT INVESTMENT PROJECTS FOR THE PERIOD 2011 - 2030 (Issued together with the Prime Minister’s Decision No. 1488/QD-TTg dated August 29, 2011)

No.

Project name

Location

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Cement production capacity (tonne/year) (applicable to rotary kilns)

Completion time

By December 31, 2010, 59 rotary-kiln cement production lines have been brought into operation (details given in the Appendix II) with total designed capacity:

62,560,000

PROJECTS PLANNED TO BE OPERATED IN 2011 (8 projects)

6,920,000

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Accumulated capacity: 69,480,000

1

Tan Quang

Tuyen Quang province

Vinacomin

910,000

1^st Quarter

2

Quan Trieu

...

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Quan Trieu Cement JSC

600,000

2^nd Quarter

3

He Duong 1 (converted)

Hoa Lu district, Ninh Binh province

He Duong Cement JSC

1,800,000

4^th Quarter

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Ha Tien 2 – 2

Kien Luong district, Kien Giang province

Ha Tien 2 Cement JSC

1,400,000

4^th Quarter

5

X18 (converted)

Yen Thuy district, Hoa Binh province

X18 Cement JSC

...

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4^th Quarter

6

Ang Son 2

Quang Ninh district, Quang Binh province

Thang Loi casting mechanical Co., Ltd.

600,000

4^th Quarter

7

Mai Son

...

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Mai Son Cement JSC

910,000

4^th Quarter

8

Huong Son (converted)

Lang Giang district, Bac Giang province

Huong Son Cement JSC

350,000

4^th Quarter

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PROJECTS PLANNED TO BE OPERATED IN 2012 (8 projects)

7,570,000

Accumulated capacity: 77,050,000

9

Lang Son (converted)

Cao Loc district, Lang Son province

Lang Son Cement JSC

350,000

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10

12/9 Nghe An (converted)

Anh Son district, Nghe An province

12/9 Petroleum Cement JSC

600,000

1^st Quarter

11

Trung Son

Luong Son district, Hoa Binh province

...

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910,000

1^st Quarter

12

He Duong II

Hoa Lu district, Ninh Binh province

He Duong Cement JSC

1,800,000

2^nd Quarter

13

...

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Ha Giang city, Ha Giang province

Ha Giang Cement JSC

600,000

4^th Quarter

14

Dong Lam

Phong Dien district, Thua Thien Hue province

Dong Lam Cement JSC

1,800,000

...

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15

Xuan Thanh 1

Thanh Liem district, Ha Nam province

Xuan Thanh investment & development Co., Ltd.

910,000

4^th Quarter

16

VINAFUJI (converted)

Bao Thang district, Lao Cai province

...

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600,000

4^th Quarter

PROJECTS PLANNED TO BE OPERATED IN 2013 (6 projects)

9,110,000

Accumulated capacity: 86,160,000

17

Cong Thanh 2

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Cong Thanh Cement JSC

3,600,000

2^nd Quarter

18

Quang Phuc

Tuyen Hoa district, Quang Binh province

Vietnam building material Co., Ltd.

1,800,000

2^nd Quarter

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Ha Tien – Kien Giang

Kien Luong district, Kien Giang province

Ha Tien clinker JSC

600,000

4^th Quarter

20

My Duc

My Duc district, Hanoi capital

My Duc Cement JSC

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4^th Quarter

21

Thanh Son

Ngoc Lac district, Thanh Hoa province

Thanh Son Cement JSC

910,000

4^th Quarter

22

Truong Son – Ro Li

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Roli cement JSC

600,000

4^th Quarter

PROJECTS PLANNED TO BE OPERATED IN 2014 (5 projects)

4,320,000

Accumulated capacity: 90,480,000

23

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Anh Son district, Nghe An province

Hop Son Cement JSC

350,000

4^th Quarter

24

Tan Thang

Quynh Luu district, Nghe An province

Tan Thang Cement JSC

1,800,000

...

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25

Thanh Truong (converted)

Quang Trach district, Quang Binh province

Thanh Truong Cement JSC

350,000

4^th Quarter

26

VisaiHanam

Thanh Liem district, Ha Nam province

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910,000

4^th Quarter

27

Do Luong

Do Luong district, Nghe An province

Do Luong cement JSC

910,000

4^th Quarter

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3,760,000

Accumulated capacity: 94,240,000

28

Tan Phu Xuan (converted)

Thuy Nguyen district, Hai Phong city

Tan Phu Xuan Cement JSC

910,000

4^th Quarter

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Son Duong

Son Duong district, Tuyen Quang province

Thai Son company, the Ministry of National Defense

350,000

4^th Quarter

30

Quang Minh

Thuy Nguyen district, Hai Phong city

Quang Minh War Invalids Collective Enterprise

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4^th Quarter

31

Nam Dong

Nam Dong district, Thua Thien Hue province

Nam Dong Viet Song Long cement investment JSC

1,800,000

4^th Quarter

32

Cao Bang (converted)

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Cao Bang cement JSC

350,000

4^th Quarter

PROJECTS PLANNED FOR INVESTMENT FOR THE PERIOD 2016 - 2020 (22 projects)

36,330,000

Accumulated capacity: 129,520,000

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Thanh Liem district, Ha Nam province

Xuan Thanh investment & development Co., Ltd.

2,300,000

34

Thang Long 2

Quang Ninh province

Thang Long 2 Cement JSC

2,300,000

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35

Cao Duong (converted)

Kim Boi district, Hoa Binh province

Luong Son Cement JSC

910,000

36

Minh Tam

Hon Quan district, Binh Phuoc province

...

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1,800,000

37

Tay Ninh 2

Tan Chau district, Tay Ninh province

FICO Tay Ninh Cement JSC

1,400,000

38

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Thuy Nguyen district, Hai Phong city

Bach Dang Cement JSC

1,200,000

39

Song Gianh 2

Tuyen Hoa district, Quang Binh province

Song Gianh Cement JSC

1,400,000

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40

Hoang Mai 2

Nghe An province

Hoang Mai Cement JSC

4,500,000

41

Bim Son (transforming from wet to dry cement process technology)

Thanh Hoa province

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1,400,000

42

Ha Tien 2 - 1 (transforming from wet to dry cement process technology)

Kien Giang province

Ha Tien cement JSC (total capacity of 1,400,000, increased capacity of 1,160,000)

1,160,000

43

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Yen The district, Bac Giang province

IDC Technology Development JSC

910,000

44

An Phu

Binh Long district, Binh Phuoc province

An Phu Cement JSC

1,800,000

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45

Yen Mao (replacing Huu Nghi 1, 2, 3)

Thanh Thuy district, Phu Tho province

Hung Vuong development JSC

910,000

46

Phu Son

Nho Quan district, Ninh Binh province

...

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1,200,000

47

Long Tho 2 (converted)

Huong Tra district, Thua Thien Hue province

Song Hong Construction Corporation

910,000

48

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Tuyen Hoa district, Quang Binh province

Truong Thinh construction Co., Ltd.

1,800,000

49

Thanh My

Nam Giang district, Quang Nam province

Xuan Thanh Corporation

1,200,000

...

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50

Tan Tao

Thanh Liem district, Ha Nam province

Tan Tao Industry Investment JSC

910,000

51

Binh Phuoc 2

Binh Phuoc province

...

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4,500,000

52

Cho Moi

Cho Moi district, Bac Kan province

Bac Kan Mineral JSC

910,000

53

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Hoanh Bo district, Quang Ninh province

Ha Long Cement JSC

2,000,000

54

Sai Gon Tan Ky

Tan Ky district, Nghe An province

Sai Gon Investment Corporation

910,000

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PROJECTS PLANNED FOR INVESTMENT FOR THE PERIOD 2021 - 2030 (6 projects)

9,820,000

Accumulated capacity: 139,340,000

55

Tan Lam

Quang Tri province

Tan Lam Cement JSC

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56

Ngan Son

Yen The district, Bac Giang province

Truong Son JSC

910,000

57

Holcim 2

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Holcim Vietnam JVC

3,600,000

58

Yen Binh 2

Yen Binh district, Yen Bai province

Yen Binh Cement JSC

910,000

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Hoa Phat 2

Thanh Liem district, Ha Nam province

Hoa Phat Cement JSC

1,800,000

60

Hoang Son

Nong Cong district, Thanh Hoa province

Hoang Son Cement JSC

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Note:

(2) The specific progress of projects planned for investment for the period 2016 - 2030 will be adjusted as per the current state of project execution.

APPENDIX II

LIST OF EXISTING ROTARY-KILN CEMENT PRODUCTION LINES UPDATED AS OF DECEMBER 31, 2010 (Issued together with the Prime Minister’s Decision No. 1488/QD-TTg dated August 29, 2011)

No.

Name of cement plants

Location

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1

Dien Bien

Dien Bien Phu city, Dien Bien province

350,000

2

La Hien 1

Vo Nhai district, Thai Nguyen province

250,000

3

...

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Vo Nhai district, Thai Nguyen province

600,000

4

Quang Son

Dong Hy district, Thai Nguyen province

1,500,000

5

Tuyen Quang

Tuyen Quang township, Tuyen Quang province

...

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6

Huu Nghi 1

Viet Tri city, Phu Tho province

250,000

7

Huu Nghi 2

Viet Tri city, Phu Tho province

350,000

8

...

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Viet Tri city, Phu Tho province

450,000

9

Song Thao

Thanh Ba district, Phu Tho province

910,000

10

Thanh Ba

Thanh Ba district, Phu Tho province

...

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11

Yen Binh

Yen Binh district, Yen Bai province

910,000

12

Yen Bai

Yen Binh district, Yen Bai province

350,000

13

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Chi Lang district, Lang Son province

910,000

14

Hoa Binh

Luong Son district, Hoa Binh province

350,000

15

Nam Son

Chuong My district, Hanoi capital

...

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16

Hoang Thach 1

Kinh Mon district, Hai Duong province

1,100,000

17

Hoang Thach 2

Kinh Mon district, Hai Duong province

1,200,000

18

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Kinh Mon district, Hai Duong province

1,300,000

19

Phuc Son

Kinh Mon district, Hai Duong province

1,800,000

20

Thanh Cong 3

Kinh Mon district, Hai Duong province

...

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21

Phuc Son 2

Kinh Mon district, Hai Duong province

1,800,000

22

Phu Tan

Kinh Mon district, Hai Duong province

350,000

23

...

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Thuy Nguyen district, Hai Phong city

1,400,000

24

Chinh phong 1

Thuy Nguyen district, Hai Phong city

1,400,000

25

Chinh phong 2

Thuy Nguyen district, Hai Phong city

...

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26

Cam Pha

Cam Pha township, Quang Ninh province

2,300,000

27

Thang Long

Hoanh Bo district, Quang Ninh province

2,300,000

28

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Uong Bi township, Quang Ninh province

450,000

29

Lam Thach 2

Uong Bi township, Quang Ninh province

450,000

30

Ha Long

Hoanh Bo district, Quang Ninh province

...

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31

But Son

Kim Bang district, Ha Nam province

1,400,000

32

But Son 2

Kim Bang district, Ha Nam province

1,600,000

33

...

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...

Thanh Liem district, Ha Nam province

120,000

34

X 77

Kim Bang district, Ha Nam province

120,000

35

Hoang Long

Thanh Liem district, Ha Nam province

...

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36

Thanh Liem

Thanh Liem district, Ha Nam province

450,000

37

Hoa Phat

Thanh Liem district, Ha Nam province

910,000

38

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Tam Diep township, Ninh Binh province

1,400,000

39

Vinakansai

Gia Vien district, Ninh Binh province

910,000

40

Duyen Ha 1

Hoa Lu district, Ninh Binh province

...

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41

Duyen Ha 2

Hoa Lu district, Ninh Binh province

1,800,000

42

Huong Duong

Tam Diep township, Ninh Binh province

910,000

43

...

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...

Tam Diep township, Ninh Binh province

910,000

44

Visai

Gia Vien district, Ninh Binh province

1,800,000

45

Bim Son

Bim Son township, Thanh Hoa province

...

...

...

46

Bim Son 2

Bim Son township, Thanh Hoa province

2,000,000

47

Cong Thanh

Tinh Gia district, Thanh Hoa province

910,000

48

...

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...

Tinh Gia district, Thanh Hoa province

2,150,000

49

Nghi Son 2

Tinh Gia district, Thanh Hoa province

2,150,000

50

Hoang Mai

Quynh Luu district, Nghe An province

...

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...

51

Song Gianh

Tuyen Hoa district, Quang Binh province

1,400,000

52

Ang Son

Quang Ninh district, Quang Binh province

350,000

53

...

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...

Huong Tra district, Thua Thien Hue province

600,000

54

Luksvasi 3

Huong Tra district, Thua Thien Hue province

650,000

55

Luksvasi 4

Huong Tra district, Thua Thien Hue province

...

...

...

56

Tay Ninh

Tan Chau district, Tay Ninh province

1,500,000

57

Binh Phuoc 1

Binh Long district, Binh Phuoc province

2,300,000

58

...

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...

Kien Luong district, Kien Giang province

1,310,000

59

Holcim

Kien Luong district, Kien Giang province

1,760,000

Total

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Note: Total designed capacity of rotary-kiln cement plants is expected to reach 3 million of tonnes by 2010. Cement production lines, such as Huu Nghi 1, 2 and 3, will be replaced by Yen Mao project given in Appendix I.