Under Article 6.1 of the 2022 Petroleum Law, Vietnam’s petroleum resources are recognised as property owned by all Vietnamese citizens, represented and unifiedly managed by the State. However, the law also allows contractors to own a portion of the petroleum products and other related products extracted under petroleum contracts, provided they have fulfilled their financial obligations as required by law.

Therefore, the fundamental difference between public ownership and private ownership of petroleum is that all Vietnamese citizens collectively own petroleum resources, while contractors only own the petroleum products specified in their signed contracts, subject to certain conditions.

The government of Vietnam is the highest authority responsible for the unified state management of fundamental petroleum investigation and petroleum operations.

The Ministry of Industry and Trade (MOIT) is an agency of the Vietnam government, responsible for state management in industry and trade, including the petroleum sector. According to Article 65 of the Petroleum Law 2022, the MOIT is responsible for state management in basic petroleum investigation and petroleum activities. In addition, ministries, agencies equivalent to ministries, and provincial People’s Committees are responsible for co-ordinating with the MOIT to implement state management of basic petroleum investigation and petroleum activities.

The Commission for the Management of State Capital at Enterprises (CMSC) is a governmental agency entrusted by the government to exercise the rights and responsibilities to provide opinions for, inspect and supervise competent parties regarding the use of capital in petroleum contracts.

The Ministry of Agriculture and Environment (MAE) is an agency of the Vietnam government, responsible for carrying out the function of state management in the field of mineral resources. The MAE is responsible to the government for implementing state management of minerals nationwide and for carrying out several tasks, including as follows:

• granting, extending and revoking mineral exploration permits and mineral mining permits; and
• organising auctions of mining rights under its jurisdiction; etc.

As of 9 April 2025, the Vietnam Oil and Gas Group has been renamed the Vietnam National Industry – Energy Group (PVN). The PVN inherits all rights, obligations and responsibilities of the former Vietnam Oil and Gas Group in accordance with the Petroleum Law 2022 and other applicable legal regulations. As a state-owned enterprise of Vietnam operating within the energy industry, and covering oil and gas as well as renewable energy sectors, the PVN is vital for national economic growth. It contributes to the development of a high-quality workforce, promotes global integration and attracts foreign investment.

The main hydrocarbon laws and regulations include the following.

The Petroleum Law 2022

This provides a fundamental investigation of petroleum and petroleum operations within the mainland, islands and territorial waters of the Socialist Republic of Vietnam. It applies to Vietnamese and foreign agencies, organisations and individuals related to fundamental investigation of petroleum and petroleum operations.

Decree No 45/2023/ND-CP on Elaborating the Petroleum Law

This provides detailed regulations on several articles of the Petroleum Law, including:

• basic petroleum investigations;
• petroleum contracts;
• petroleum operations; and
• documentation, order and procedures for implementing petroleum activities and projects, etc.

The Mineral Law 2010

This regulates legal issues related to minerals, including petroleum, and covers the following areas:

• basic geological surveys of minerals;
• protection of unexploited minerals;
• mineral exploration and exploitation; and
• State management of minerals within the mainland, islands, internal waters, territorial sea, contiguous zone, exclusive economic zone, and continental shelf of the Socialist Republic of Vietnam.

Decree No 158/2016/ND-CP on Guidelines for the Mineral Law

This provides detailed guidelines on the following matters:

• reimbursement of costs for geological baseline surveys of minerals and costs of mineral exploration;
• requirements for periodical reports on mineral activities;
• regulations for the appointment and responsibilities of mine managers;
• certification of the owner’s equity; and
• procedures for mineral planning, etc.

In Vietnam, the production sharing contract (PSC), which will be executed between the PVN and private investors, is the primary form of allowed private investment in upstream hydrocarbon activities.

Under PSCs, investors gain the right to explore for, develop and produce hydrocarbons within a specified contract area. Investors must comply with work commitments and expenditure obligations outlined in the PSC.

The PSC must align with the form of contract provided under Decree No 45/2023/ND-CP.

PSCs will be subject to the MOIT’s verification and the Prime Minister’s approval for official execution.

In parallel with PSCs, multiple contractors under PSCs will enter into a joint operating agreement (JOA) for the respective oil and gas block. The JOAs stipulate the management of the contractor’s activities and specify the corresponding rights and obligations associated with each party’s participating interest in petroleum operations.

Based on the signed PSCs, the MOIT issues Investment Registration Certificates to contractors performing petroleum operations.

The PSC of an oil and gas block is issued through a well-defined process managed by the PVN, the MOIT and the Prime Minister. The Petroleum Law 2022 and Decree No 45/2023/ND-CP regulate the bidding process and requirements for investors to enter into the PSC for oil and gas exploration, development and production.

Bidding for Contractor Selection

The selection of contractors for available oil and gas blocks is made by bidding or direct contracting (in several certain circumstances).

Interested investors must first send the bid registration to the PVN. Eligible investors will be entitled to receive the invitations to bid and participate in the bidding process.

Eligibility Requirements for Bidding

The investors must:

• have business registration certificates (in the case of organisation investors) or civil capacity (in the case of individual investors) under the laws of investors’ countries; and
• possess financial and technical capacity as well as experience in petroleum operations – if investors do not meet this requirement, they must establish a consortium with other investors to be eligible for bidding.

Qualifications for Contractor Selection

The invitation to bid for each particular oil and gas block will specify the requirements for the bid bond as well as minimum financial and expertise capacity. According to Article 18 of Decree No 45/2023/ND-CP, general criteria include the following.

• Capacity and experience of contractors, including:
1. technical and financial capacity, and available funding sources for execution of petroleum operations; and
2. experience in executing petroleum operations and petroleum contracts.
• Technical conditions, including:
1. minimum work obligations (new seismic acquisition, reprocessing of seismogram, quantity of wells);
2. field development and extraction obligations; and
3. methods of implementation and optimal technology for petroleum operations.
• Economic conditions, including:
1. taxes;
2. host country’s profit oil/gas ratio;
3. participating interests of host country (via the PVN) upon making the first commercial discovery;
4. participating interests of the PVN or subsidiaries thereof;
5. percentage of costs recovered; and
6. financial commitments.

The typical fiscal terms under PSCs are structured to balance the interests of the government and investors, ensuring the State’s share of profits while encouraging foreign investment in hydrocarbon exploration and production. The key components of the fiscal terms are as follows.

• One key component is the area limit and schedule for return of contract area.
• Determination of Recoverable Costs: Contractors are allowed to recover their exploration and development costs from a percentage of the production, typically up to a certain limit.
• Profit Oil/Gas Split: After cost recovery, the remaining production (profit oil/gas) is split between the State (via the PVN) and the contractors. The State’s share typically increases with the level of production.
• State Participation: The PVN often has the right to participate in the project with an equity interest, which can range from 10% to 50%.
• Taxes and Fees: The standard corporate income tax rate for oil and gas activities is 32%, though it can be reduced to 25% for specific projects under certain conditions. Additional taxes may include export duties (if applicable), value-added tax (VAT) and environmental fees. The specifics can vary and are typically outlined in the PSCs.
• Bonuses: The PSC includes signature, commercial discovery and production bonuses, which are negotiated in the contract. These bonuses are payable to the state or the PVN upon meeting specified conditions.

The key taxes and fiscal obligations include the following.

• Corporate Income Tax (CIT): The CIT rate for hydrocarbon upstream activities is 32%. Certain projects – especially those involving deepwater, offshore or complex geological conditions – may qualify for a reduced rate of 25%.
• Special Petroleum Tax (SPT): The SPT is applied to the profits from hydrocarbon production. The rates range from 10% to 50%, depending on the level of profitability and production output.
• Royalties: Royalties are imposed on the gross revenue from oil and gas production.
• Export Duties: These duties can range from 10% to 20%, but specific rates can be subject to change and depend on government regulations at the time of exportation.
• VAT: The VAT standard rate in Vietnam is 10%. However, certain goods and services related to upstream operations may be subject to different rates or exemptions.
• Import Duties: Import duties are levied on the importation of equipment, machinery and materials for exploration and production. Certain exemptions or reductions may apply to goods used directly in oil and gas operations.
• Environmental Protection Tax: Rates are defined by the government and are intended to mitigate environmental damage.
• Additional Fees and Contributions: These can include infrastructure development fees, social insurance contributions for employees, and other mandatory government levies.

Regarding upstream licensing, the PVN is granted several rights under the Petroleum Law 2022. These privileges are intended to ensure the PVN’s pivotal position in the exploration and extraction of the Vietnamese hydrocarbon reserves. Key rights and privileges accorded to the PVN include the following.

Participation Rights

The PVN may use its right to engage in PSCs with the scope of participation interests being contingent on the Prime Minister’s consideration and decision. In the event that the contractors decide to withdraw from the PSC for unique reasons that have been approved by the Prime Minister, the PVN is specifically allowed to transfer all participation rights, data and ongoing upstream projects of the contractors.

Priority Rights

Based on the transfer circumstances agreed upon between the parties’ and their intention to transfer with the possible transferee, the PVN has the right to pre-emptively purchase all or a portion of the participation interests that the contractor intends to transfer in the signed PSCs.

Operatorship Rights

The PVN has the right and obligation to manage, operate and exploit petroleum resources effectively while engaging in petroleum operations in order to preserve resources, the environment and public safety. In some cases, the PVN has the right to take over operatorship of the project after a certain period.

Approval of Work Programmes and Budgets

The PVN has the authority to:

• approve annual work programmes and budgets;
• audit the expenses incurred in carrying out petroleum operations in compliance with the terms of PSCs; and
• approve cost allocations in relation to PSCs, etc.

Domestic Market Obligation

As a contractor operating under a PSC, co-ordinating the sale of the petroleum products of the host nation in addition to the PVN’s petroleum products, the PVN is permitted to purchase these products alongside those of other contractors involved in PSCs.

Regulatory and Advisory Role

The PVN plays an important role in:

• the approval of programmes for the search and exploration of upstream projects, as well as programmes for modified and additional search and exploration; and
• the approval of adjustments to the field development general plan, the plan for early petroleum exploitation, the plan for petroleum exploitation, etc.

Some key local content requirements applicable to upstream operations by private investors include the following:

• fulfilling obligations under oil and gas contracts, as well as disclose and pay taxes, fees, and levies in compliance with Vietnamese laws;
• training and hiring Vietnamese employers, as well as securing their lawful and legitimate rights and interests of employers;
• environmental protection and national defence and security, including:
1. adhering to the legislation pertaining to these areas;
2. putting environmental protection and safety measures in place for petroleum operations; and
3. implementing regulations and guidelines on cost, economic and technical norms issued by state management bodies;
• reporting to the state management agencies, the PVN and the competent tax agency when a transfer operation arises concerning changes in the owner of the contractor holding the participation rights in a PSC in Vietnam;
• making payments for petroleum operations in accordance with the terms of the PSCs by transferring capital contributions to the operation account established by the operator or the operator’s executive office in Vietnam; and
• abandonment of oil and gas facilities, equipment and vehicles after the end of oil and gas operations in accordance with the provisions of law.

Once the contractor has a commercial discovery, some key requirements include the following.

The contractor must submit a written notice to the PVN about the commercial discovery that can be exploited economically.

The contractor is permitted to retain the gas-discovered area even after announcing a commercial discovery, and there is no market for consumption and no requirements for suitable pipelines and treatment facilities. With consent from the MOIT, the gas-discovered area may be retained for a maximum of five years. The Prime Minister will consider allowing an extension of the gas-discovered area’s retention period, but not for more than two years, based on the MOIT’s appraisal, in the event that the term of retention expires and there is no market for consumption and no requirements for suitable pipelines and treatment facilities.

Other key terms of the PSC current template include the following.

Exploration Phase

The exploration term can be no more than five years or no more than ten years depending on the term of the petroleum contract(s).

Development Phase

The contractor creates the petroleum development plan, submits it to the PVN and reports to the MOIT for appraisal and approval, following the approval of the general petroleum development plan or before the conclusion of the early petroleum exploitation plan’s implementation term.

Minimum Work Programmes

Contractors must commit to a minimum work programme, which includes seismic surveys, drilling of exploration wells, and other geological and geophysical studies.

Extensions

The term of a PSC may be extended but cannot exceed five years. The term of the exploration period may be extended but cannot exceed five years, based on the approval of the MOIT. In special cases, for reasons of national defence, security, complex geological conditions, unique field operation challenges, or to ensure effective gas extraction time, the Prime Minister may approve an additional extension of the PSC term.

Relinquishment Obligation

The contractor is responsible for relinquishing portions of the contract area that are determined to have no petroleum potential during the implementation of the contractual phases. The minimum relinquishment requirements are clearly stipulated in the petroleum contract.

Domestic Supply Requirements

Contractors are required to sell in the Vietnamese market, upon the government’s request:

• their share of natural gas as agreed in gas development projects; and
• their share of crude oil at internationally competitive prices.

Export Rights

Contractors have the right to export and sell petroleum products they own under the petroleum contract without an export licence.

Liability and Risk Regime

Contractors are responsible for all risks and legal liabilities arising from petroleum operations. They must obtain mandatory insurance, including environmental, third-party, personal and property coverage. In addition, contractors must establish systems for security, emergency response and alerts in line with international practices.

Withdrawal, Termination and Abandonment

Withdrawal

The PVN shall be permitted to fully receive transfer of existing participating interests, data and petroleum installations of a contractor if the contractor decides to withdraw from the petroleum contract for the special reasons approved by the Prime Minister. Accordingly, it can be understood that contractors may withdraw from a petroleum contract for special reasons, subject to the approval of the Prime Minister.

Termination

A petroleum contract may be terminated:

• upon expiry without extension or as otherwise stipulated in the contract itself; or
• prior to expiry by mutual agreement of the parties, provided that the contractor has fulfilled all obligations and notifies the PVN at least six months in advance.

The specific procedures and consequences of such termination are governed by the petroleum contract.

Abandonment

Contractors must abandon petroleum facilities that are unused, severely damaged or unsafe in accordance with an approved decommissioning plan, and must establish a decommissioning trust fund within one year from the commencement of commercial production. The fund is contributed to annually and managed by the PVN. Decommissioning costs may be adjusted if increased by less than 20%, and additional contributions are required if the fund is insufficient.

Article 34 of Decree No 45/2023 regulates dossiers and processes for assessment and approval of the implementation of participation interests, and the priority right to pre-purchase participation interests and to receive participation interests in PSCs, as follows.

Based on the contractor’s proposal approved by the PVN, the PVN can request appraisal of permission to exercise participation interests in PSCs or the priority right to pre-purchase participation interests that contractors intend to transfer in signed PSCs, as well as to assume all rights of the contractor if the contractor decides to withdraw from the PSC for special reasons. The PVN submits two dossiers to the MOIT in accordance with the terms agreed upon between the contractor and the PVN.

Within five working days from the date of receiving the valid dossiers, the MOIT sends the dossiers to seek opinions from the relevant ministries.

The relevant ministries provide written comments to the MOIT on the content falling under the purview of their state administration within 15 days from the date on which they received the dossiers.

Within 45 days from the date of receiving the valid MOIT dossier, completing the appraisal of the request to exercise the participation interests, the pre-purchase participation interests or receiving the participation interests in the petroleum contract, the PVN must submit to the Prime Minister for consideration and approval.

In addition to the regulations on documents and procedures mentioned above, the system for management, accounting, use of assets, and receipt of all participation benefits from contractors in unusual instances is described in Article 38 of Decision No 45/2023.

The PVN obtains all the contractor’s participation interests in the PSCs, and receives information, data, dossiers, samples, petroleum works and other assets (if any) in their original form in accordance with the signed PSCs.

In order to retain PSCs, PVN creates an annual management cost plan, monitors assets and expenses for associated developing difficulties, and the Board of Members of PVN approves audit results.

Apart from the statutory procedures involving PVN and MOIT, the legal framework does not provide a detailed and unified process applicable to all transfers of interests between private investors. In practice, such transactions are also subject to the specific terms of the PSC and relevant commercial agreements. Accordingly, the following requirements may apply:

• Financial and Technical Capacity: The transferee must demonstrate sufficient financial strength and technical expertise to fulfil the obligations under the PSC.
• Transferor’s Retained Liabilities: The transferor may remain liable for any obligations or liabilities incurred prior to the transfer, unless agreed otherwise in the PSC or the transfer agreement.

Government Approval and Control

The production rates and levels are typically governed by the terms outlined in the PSCs between the Vietnamese government (represented by the PVN) and the contractors. The PSC specifies the production levels and schedules agreed upon during the development phase.

Environmental Considerations

Before production begins, operators are required to conduct Environmental Impact Assessments (EIAs) to assess the potential environmental impacts. The findings from these assessments may influence production rates in order to mitigate adverse effects on the environment.

State-Level Proration or Allocation

In some cases, the government may allocate production quotas among operators to ensure equitable distribution of benefits and adherence to national production targets.

No OPEC-Like Quotas

Vietnam does not participate in international production quotas such as those enforced by the Organization of the Petroleum Exporting Countries (OPEC). Therefore, production decisions are primarily guided by domestic policy and market dynamics.       

There is no government or private monopoly in midstream operations in Vietnam.

Under Article 21 of the Law on Investment 2020, there are five forms of investment in Vietnam, as follows.

Investment in the Establishment of a Business Organisation

Investors must comply with the provisions of the Law on Enterprises 2020 and domestic laws corresponding to each type of economic organisation.

In particular, foreign investors – when investing in conditional business lines – must also comply with market access conditions, including:

• investment form;
• scope of investment activities;
• charter capital ownership ratio of foreign investors in economic organisations; and
• investor capacity.

Investment in the Form of Capital Contribution or Purchase of Shares or Stakes

Investors must meet the conditions and carry out procedures for changing members and shareholders that correspond to each type of business organisation.

For foreign investors, the investor must obtain approval from investment authorities on meeting the conditions for capital contribution and share purchase as prescribed by law.

Execution of an Investment Project

A foreign-invested enterprise that is already established in Vietnam can undertake a variety of investment projects, including establishing another economic organisation.

Depending on the foreign capital ownership ratio, the investors will conduct investment procedures for domestic investors or foreign investors.

Investment in the Form of a Business Co-Operation Contract (BCC)

The BCC is a contract signed between investors for business co-operation, profit distribution and product distribution without establishing an economic organisation.

The parties to a BCC contract establish a co-ordination board to perform the BCC contract.

Other New Forms of Investment and Types of Business Organisations as Prescribed by the Government’s Regulations

The aforementioned forms shall apply both to investment projects in midstream operations and to downstream operations.

As stated in 3.1 Forms of Private Investment: Midstream/Downstream, there is no national monopoly (or near-monopoly) for downstream operations.

Investors investing in petroleum midstream and downstream operations must comply with the Law on Investment 2020 and the Law on Enterprise 2020. The licensing procedures involve several steps.

Step 1: Registration of Investment Project – Obtaining the Investment Registration Certificate (IRC) or Investment Policy Approval From the Competent Authority

Application dossier

Investors must prepare and submit an application dossier to the relevant authority. This includes:

• a written request for the implementation of the investment project;
• documents on the investor’s legal status;
• documents on the financial capacity of the investor;
• a proposal for the investment project; and
• other documents as required by law, which depend on the type and scale of the project.

Authority

The application is submitted to the authority where the project is located – namely:

• the National Assembly;
• the Prime Minister;
• the Provincial People’s Committee;
• the Department of Finance; or
• the management board of industrial parks, export processing zones, hi-tech parks or economic zones.

Step 2: Establishment of a Legal Entity – Obtaining the Enterprise Registration Certificate (ERC)

Application dossier

To establish a company (eg, a joint stock company (JSC), a limited liability company (LLC)), investors must prepare and submit an application for the ERC. This includes:

• an application form for enterprise registration;
• the company’s charter;
• a list of members (for an LLC) or founding shareholders (for a JSC);
• copies of legal documents of the members or shareholders; and
• the IRC (if the investment project involves the establishment of a new enterprise).

Authority

The application is submitted to the Business Registration Office under the Department of Finance.

Step 3: Licences for Petroleum Midstream and Downstream Operations

Application dossier

Depending on the specific activities (eg, refining, storage, transportation, distribution), additional licences and approvals are required. Typical dossiers include:

• an application form;
• the IRC and ERC;
• technical and environmental protection plans; and
• other documents as specified for the particular type of petroleum operation.

Authority

Applications are submitted to the Ministry of Industry and Trade (MOIT) or other relevant authorities.

Step 4: Compliance With Environmental Regulations Through an EIA

Application dossier

Investors must prepare and submit an EIA report. This includes:

• a written request for approval of the EIA report;
• the EIA report itself, prepared by a licensed organisation; and
• other supporting documents.

Authority

The Ministry of Agriculture and Environment or the provincial-level People’s Committee is the relevant authority.

Step 5: Construction Permits and Other Approvals

Construction permits

Application dossier

This includes detailed construction plans, the Investment Policy Approval or IRC, the ERC and other necessary documents.

Authority

The Department of Construction and Transport or the local People’s Committee is the relevant authority.

Other relevant approvals

Investors may need additional approvals related to fire fighting and prevention, labour, safety and other operational aspects.

The typical commercial arrangements for the major types of midstream and downstream operations are as follows.

Joint Venture Agreements (JVAs)

Foreign investors often enter into joint ventures with state-owned enterprises (SOEs) or local private companies. Foreign investors typically hold a significant equity stake but must comply with foreign ownership limits if applicable.

JVAs must comply with the Law on Investment and the Law on Enterprises. They must also obtain the necessary licences from the MOIT.

Build-Operate-Transfer (BOT) Contracts

Investors build a refinery or petrochemical plant, operate it for a certain period, and then transfer ownership to the Vietnamese government. The operation period is usually agreed upon in the contract. BOT projects require specific approval from the Prime Minister and must adhere to BOT regulations under Vietnamese law.

Leasing Agreements

Investors lease storage facilities (eg, tanks, terminals) from SOEs or private entities. Terms and duration are negotiated between the parties, typically ranging from short-term to long-term leases. Leasing arrangements must comply with the Civil Code and other relevant commercial laws.

Service Contracts

Companies provide transportation services (eg, pipelines, trucking, shipping) for petroleum products. Payment can be based on volume transported or other agreed metrics. Service contracts must adhere to transportation and logistics regulations, including safety and environmental standards.

Distribution Agreements

Investors enter into agreements with local distributors to market and sell petroleum products. Agreements can be exclusive or non-exclusive, depending on the market strategy. Distribution agreements must comply with the Commercial Law and regulations on petroleum trading.

In Vietnam, businesses might be subject to a complex array of tax obligations, comprising corporate income tax (CIT), VAT and export-import tax, etc. These taxes are further complicated by a robust regulatory framework that undergoes frequent updates.

CIT

Under normal circumstances, the CIT rate is 20%.

VAT

The VAT standard rate in Vietnam is 10%. However, certain goods and services related to upstream operations may be subject to different rates or exemptions.

Import-Export Duties

Import duties

The standard rate is 10% and applies to imported goods (preferential rates and special preferential rates will be applied on a case-by-case basis).

Export duties

The standard rate ranges from 0% to 40%, and applies to activities related to a few items, primarily natural resources including sand, chalk, marble, granite, ore, crude oil, forest products and scrap metal.

Environmental Protection Tax (EPT)

EPT rates for petroleum products are as follows:

• gasoline – VND4,000 per litre (from 1 January 2025);
• diesel – VND2,000 per litre (from 1 January 2025); and
• other petroleum products – VND1,000 to VND2,000 per litre, depending on the product.

Special Sales Tax (SST)

SST, also known as excise tax, applies to specific goods and services deemed luxury or non-essential, including petroleum products. The SST rates for petroleum products vary, as follows:

• gasoline – 10%;
• E5 gasoline – 8%; and
• E10 gasoline – 7%.

The PVN does not have special rights in the approval of midstream/downstream licences under Vietnamese laws. Nevertheless, the PVN may still have special rights in midstream/downstream operations, such as preferential access to infrastructure, regulatory advantages or participation rights in key projects. In addition, local requirements may apply, ensuring that Vietnamese entities – including the PVN and its affiliates – have a stake in midstream/downstream activities.

Currently, midstream and downstream petroleum activities that take place after the initial production stage – including the transportation and processing of petroleum into gasoline, diesel and other fuels – are regulated by the relevant legal framework, such as:

• the Petroleum Law 2022;
• the Law on Investment 2020;
• the Law on Construction 2014;
• the Environmental Protection Law 2020;
• the Land Law 2024;
• the Law on Export and Import Duties 2016;
• Decree No 45/2023 ND-CP dated 1 July 2023; and
• Circular No 36/2016/TT-BTC dated 26 January 2016.

Key Terms and Structures

The key terms and structures for midstream/downstream licences in the various classes of service are as follows.

Refining

• Scope of operations: clearly defines the types of refining or petrochemical processes allowed.
• Capacity and output: specifies the approved production capacity and types of products.
• Technical standards: must comply with national and international standards for safety, technology and environmental protection.
• Environmental compliance: requires an approved EIA and adherence to environmental protection laws.
• Safety regulations: compliance with safety regulations, including fire prevention and response plans.
• Investment commitment: details on the capital investment and timelines for project completion.
• Reporting obligations: regular reporting on operations, safety incidents and environmental impact to the MOIT and other relevant authorities.

Storage

• Storage capacity: specifies the approved storage capacity for petroleum products.
• Types of products: lists of the types of petroleum products that can be stored.
• Technical and safety standards: must meet national and international standards for storage facilities, including design, construction and operational procedures.
• Environmental compliance: requires an EIA approval and adherence to environmental protection regulations.
• Safety measures: compliance with safety regulations, including spill prevention and emergency response plans.
• Operational reporting: regular reporting on storage operations, safety incidents and environmental impact.

Transportation

• Transport modes: specifies the modes of transport allowed (eg, pipeline, road, rail, sea).
• Technical standards: compliance with technical standards for transportation infrastructure and equipment.
• Safety and environmental standards: must meet safety and environmental standards for transporting hazardous materials.
• Operational routes: defines approved transportation routes and logistics plans.
• Emergency response: requires plans for accident response, spill containment and other emergencies.
• Reporting obligations: regular reporting on transportation activities, safety incidents and compliance with regulations.

Distribution and retail

• Scope of distribution: specifies the regions and market segments for distribution and retail activities.
• Product range: lists of the types of petroleum products approved for distribution and retail.
• Retail standards: must comply with standards for retail operations, including service quality, safety and environmental protection.
• Facility requirements: specifies requirements for retail outlets, including design, safety features and environmental protection measures.
• Pricing regulations: adherence to pricing regulations and reporting on price adjustments.
• Operational reporting: regular reporting on sales, inventory, safety incidents and compliance with regulations.       

Private investors in Vietnam do not have condemnation or eminent domain rights. The acquisition of land for private investment projects is facilitated through state mechanisms, where the state retains the authority to expropriate land and manage compensation and resettlement. Private investors must work with state authorities and follow legal procedures to obtain land use rights, ensuring compliance with the Land Law and related regulations. For large-scale projects, especially those involving significant public interest or infrastructure development, co-ordination with government authorities is essential to navigate the complexities of land acquisition.

Hydrocarbons are classified as dangerous goods under Appendix 1 of Decree No 34/2024/ND-CP. Therefore, several regulatory conditions apply for personnel and the vehicles participating in transportation of hydrocarbons.

The management and operation of hydrocarbon transportation pipelines is mainly the responsibility of the investor and gas transportation pipeline operator. This is specifically stipulated in regulations on ensuring the safety of gas transportation pipeline systems on land (issued with Decision No 46/2004/QD-TTg of the Prime Minister, dated 26 March 2004).

The main governmental bodies involved include:

• the MOIT – the primary regulator of petroleum activities, including transportation via pipeline systems;
• the Ministry of Public Security (specifically the Department of Fire Prevention and Rescue) – oversees fire safety compliance for high-risk infrastructure; and
• the Ministry of Natural Resources and Environment – in charge of environmental protection, including EIAs applicable to pipeline construction and operations.

In Vietnam, third-party access to midstream and downstream petroleum infrastructure is regulated to ensure fair competition, efficiency and transparency in the market. The MOIT is the primary regulatory body responsible for overseeing the petroleum sector, including the enforcement of access rights and regulatory compliance. Currently, services in the oil and gas industry are highly specialised and segmented by market. Although the MOIT and the Vietnamese government provide timely guidance and updates, there are no clear and specific regulations addressing this issue specifically for the oil and gas sector. In short:

• there is no mandatory open access regime for private infrastructure;
• there is no legal requirement to unbundle services into separate components; and
• there are no prohibitions preventing an entity from operating in multiple segments of the market (eg, both transportation and distribution).

However, to comply with competition laws and anti-monopoly regulations, infrastructure investors and operators must avoid abusing dominant market positions or unreasonably restricting competitors’ access. In the event of disputes, parties may seek resolution through government intervention or legal proceedings.

Trading Licence

Companies involved in the importation, wholesale and retail distribution of petroleum products must obtain a business licence from the MOIT.

Sub-Licences

Additional licences may be required for specific activities such as wholesale distribution, retail operation of petrol stations, and storage of petroleum products.

Compliance With Quality Standards

Petroleum products must meet national technical standards and regulations. The Ministry of Science and Technology (MOST) and the MOIT set these standards.

Quality Control

Regular testing and certification of petroleum products are mandatory to ensure compliance with quality standards.

Price Stabilisation

The government regulates the pricing of petroleum products to avoid market volatility. The Ministry of Finance (MOF) and the MOIT periodically adjust prices based on global market trends and domestic economic conditions.

Price Cap

A price cap may be imposed on certain petroleum products to protect consumers from price surges.

Import Licensing

Companies must obtain import licences for petroleum products from the MOIT. This includes complying with import quotas and other regulatory requirements.

Import Quotas

The government may impose quotas on the importation of petroleum products to control supply and stabilise the market.

Retail Licensing

Establishing and operating petroleum retail stations requires approval from local authorities and the MOIT. This includes meeting location, design and safety requirements.

Environmental Standards

Petroleum businesses must comply with environmental protection laws and standards set by the Ministry of Agriculture and Environment. This includes obtaining EIA approvals for storage and distribution facilities.

Pollution Control

Measures must be placed to prevent and control pollution arising from petroleum storage, transportation and distribution activities.

Periodic Reporting

Businesses must regularly report their operations, including import and export activities, inventory levels and sales data, to the MOIT and other relevant authorities.

The export process involves obtaining specific authorisations and adhering to certain limitations and prohibitions. The following is an overview of the key laws, regulations and authorisations required for the exportation of these products.

• The Petroleum Law governs the exploration, extraction and exportation of crude oil and natural gas.
• The Commercial Law regulates the trading of goods, including petroleum products, within and outside Vietnam.
• The Investment Law provides the legal framework for foreign and domestic investment in the petroleum sector.
• Decree No 83/2014/ND-CP on petroleum business and Circular No 69/2016/TT-BTC of the Ministry of Finance relate to:
1. customs procedures for petrol, oil, chemicals and gas imported, exported, temporarily imported for re-export, in border-gate transfer and in transit;
2. materials imported for production, preparation or export processing of petrol, oil or gas;
3. imported and exported crude oil; and
4. goods imported or exported to serve petroleum activities.

Transferring midstream and downstream operations and assets in Vietnam includes:

• conducting thorough due diligence;
• obtaining necessary regulatory approvals;
• complying with competition laws;
• executing transaction agreements; and
• ensuring post-transaction compliance.

This includes the following:

• a memorandum of understanding (MOU) or letter of intent (LOI) to establish the intention of both parties to engage in a transaction, outlining the basic terms and conditions;
• review of corporate documents, licences, compliance records, contracts and any ongoing litigation or disputes through legal due diligence;
• assessment of financial statements, tax records, financial obligations, operational processes, asset conditions and technological standards through financial and operational due diligence;
• transaction structuring by executing the asset purchase agreement (APA) or share purchase agreement (SPA);
• obtaining regulatory approvals including approval for investment policy amendment or IRC amendment, as well as ERC amendment and sector-specific approvals; and
• ensuring post-transaction compliance, including notification to tax authorities and updating of internal records.

Foreign investment in hydrocarbons in Vietnam is governed by both the Petroleum Law 2022 and the Law on Investment 2020, for attracting foreign investors and safeguarding national interests.

Foreign Investment Review Processes

For upstream operations:

• foreign investors must participate in the bidding process of contractor selection as regards signing the petroleum contract with the PVN;
• based on the approved contractor selection result, the PVN shall submit the petroleum contract to the MOIT for appraisal and to the Prime Minister for approval; and
• the MOIT shall issue Investment Registration Certificates to contractors performing oil and gas operations.

For midstream/downstream operations:

• foreign investors must obtain an Approval for Investment Policy from the National Assembly/Prime Minister/Provincial People’s Committee, or an Investment Registration Certificate from the Department of Finance or the Management Board of Industrial Zones, depending on the location and scale of the project;
• in addition to the Investment Registration Certificate, an Enterprise Registration Certificate is required to establish a legal entity in Vietnam; and
• large-scale and sensitive projects, such as those in the oil and gas sector, often require additional approvals from the Prime Minister or relevant ministries (eg, the MOIT).

Restricted investments

The oil and gas sector is subject to specific conditions:

• foreign ownership is often capped at certain levels;
• joint ventures with state-owned enterprises such as the PVN are common; and
• participation in upstream activities (exploration and production) generally requires entering into production sharing contracts or joint operating agreements with the PVN.

Incentives and Protections for Foreign Investment

Tax incentives

Investors in the oil and gas sector can benefit from preferential CIT rates, tax holidays and reductions. For instance, an investor in an oil and gas block that meets the criteria for receiving special investment incentives may enjoy favourable tax treatment, including:

• a reduced CIT rate of 25%;
• a lower crude oil export tax rate of 5%; and
• a maximum cost recovery rate of 80% of oil production.

Exemption from import and export duties

Investors are entitled to exemption from import and export tariffs to serve petroleum operations.

Protection against expropriation

The Law on Investment 2020 provides that foreign investors are protected against nationalisation or confiscation of assets. Expropriation is only allowed in very exceptional cases for national defence and security, with fair compensation being provided.

At present, no sanctions apply to investments in oil and gas assets or to conducting business in the oil and gas sector in foreign jurisdictions.

Principal Environmental Laws

The current environmental law in Vietnam is the Law on Environmental Protection 2020, which governs environmental protection activities and defines the rights, obligations and responsibilities of agencies, organisations, residential communities, households and individuals involved in environmental protection.

Companies in this industry must strictly comply with updated regulations on waste and emission management, develop environmental emergency response plans (particularly for oil spills) and ensure that all projects undergo an EIA before receiving an operating licence. These measures aim to promote sustainable oil and gas exploration and processing while minimising environmental harm.

Since the enactment of the Law on Environmental Protection 2020, the Vietnamese government has introduced new decrees to refine its implementation:

• Decree No 08/2022/ND-CP (dated 10 January 2022) elaborates on several articles of the Law on Environmental Protection;
• Decree No 45/2022/ND-CP (dated 7 July 2022) outlines penalties for administrative environmental protection offences;
• Decree No 27/2023/ND-CP (dated 31 May 2023) establishes environmental protection fees for mineral extraction; and
• Decree No 05/2025/ND-CP (dated 6 January 2025) amends and supplements certain articles of Decree 08/2022/ND-CP, further clarifying regulations on Extended Producer Responsibility (EPR) and other environmental protection measures.

These updates reflect Vietnam’s ongoing commitment to strengthening environmental governance, promoting sustainable development and aligning with international environmental standards.

Vietnam’s Environmental Management Agencies

Environmental management agencies in Vietnam are structured at each level of government:

• The Ministry of Agriculture and Environment (MAE) (mae.gov.vn) is the central government agency responsible for managing the state’s natural resources and environmental issues.
• Each province has its own Department of Agriculture and Environment.
• At the commune level, there are only civil servants in charge of land administration, agriculture, construction and the environment.

According to the provisions of the Law on Environmental Protection 2020 and Decree No 45/2023/ND-CP, oil and gas projects are classified as projects with a high risk of adverse environmental impact. Therefore, the investor is required to conduct a preliminary environmental impact assessment (PEIA) during the stage of seeking investment policy approval, in order to identify major environmental risks at an early stage and provide the basis for preparing a full EIA report.

According to the government’s guidance in Decree No 45/2023/ND-CP elaborating on the Petroleum Law, after completing the PEIA and before commencing the hydrocarbon project, the project investor is obliged to prepare, submit for appraisal and obtain approval for the EIA report in accordance with environmental protection laws.

In the EIA, the project investor must conduct consultations with the affected community, individuals directly impacted by the project, and agencies and organisations directly related to the project through postings on electronic information portals, organising meetings to collect opinions or gathering written opinions. The results of these consultations are important information for the project investor to study and propose solutions to mitigate the project’s environmental impact and to finalise the EIA report.

The appraisal and approval process for the EIA report by the competent authorities usually takes place within three months. The decision to approve the appraisal results of the EIA report is one of the bases for obtaining an environmental permit.

Offshore development must comply with the following EHS processes and requirements.

EIA

Offshore oil and gas projects must conduct a comprehensive EIA as required by the Law on Environmental Protection 2020. The EIA must be approved by the MAE.

The EIA should include assessments of potential impacts on marine ecosystems, water quality, air quality and socio-economic factors.

Hydrocarbon Exploration Programmes

The hydrocarbon exploration programmes are developed by offshore oil and gas contractors during the period of hydrocarbon exploration and submitted to the PVN for appraisal and approval.

The programme must cover the plan for implementation of safety and environmental protection, including safety and incident handling and solutions to prevent and handle pollution risks.

Field Development Plans (FDPs)

The FDPs are prepared on the basis of the approved outline field development plans (ODPs) and early field development plans (EDPs).

Contractors shall prepare and submit an FDP to the PVN, which will submit a report to the MOIT for appraisal and approval.

The FDPs include plans for the protection of resources, the environment and ecology, outlining safety and incident handling and solutions to prevent and handle pollution risks and decommission petroleum installations.

Decommissioning Plans

Project contractors must conduct assessments of the suitability of the waste management and marine pollution control plan, the environmental monitoring plan, the environmental incident prevention and response plan, and the safety assurance plan, when preparing the decommissioning plan after ending each phase or terminating the petroleum contract.

Safety Requirements

Project owners involved in offshore oil and gas exploration and exploitation must also comply with safety requirements, including:

• establishing safety zones and maintaining safety signals for oil and gas structures and machinery;
• refraining from constructing structures, launching floating vessels or establishing safety zones around structures or vessels in areas that could obstruct recognised essential international maritime traffic routes;
• establishing a safety management system and implementing safety measures in accordance with the approved safety management programme;
• updating data and finalising risk assessment reports and emergency response plan implementation reports;
• implementing measures to ensure occupational safety and fire fighting and prevention in accordance with legal regulations;
• being equipped with warning systems to detect possible bad circumstances causing harm to installations and the environment, and automatically giving notice of normally unmanned offshore petroleum installations to operation centres; and
• preparing emergency vessels to ensure timely rescue in cases of emergency in respect of normally manned offshore petroleum installations.

Decommissioning Plans

Within one year from the date of commercial production of the first oil and gas flow from the petroleum contract area, the contractor must prepare and submit a decommissioning plan to the PVN, which will submit a report to the MOIT for appraisal and approval.

At least one year before the date on which the petroleum contract terminates or the extraction period ends, the contractor must update and send the decommissioning plan to the PVN, which will submit a report to the MOIT for appraisal and approval.

The scope of the decommissioning plan includes the plugging and abandonment of wells, removal of facilities and infrastructure, site restoration and environmental remediation.

The plan should detail the technical, safety and environmental measures to be implemented during the decommissioning process. The plan must also include a schedule of activities, cost estimates, and a description of the methods and technologies to be used.

As mentioned, the decommissioning plan must be submitted to the MOIT for review and approval. Approval is contingent on the plan meeting all regulatory requirements and demonstrating that decommissioning activities will be conducted in a manner that ensures safety and environmental protection. The MOIT may require modifications to the plan before approving.

Financial Security

Contractors are required to provide financial security to cover the costs associated with decommissioning. Financial security in decommissioning of petroleum installations shall be done by the method of setting up a fund. 

This fund is annually allocated on the basis of the approved decommissioning plan and transferred to the PVN.

The fund annually allocated for each contractor is related to the participating interest of such contractor prescribed in the petroleum contract, and is included in the recovery cost of the petroleum contract.

Before the petroleum contract terminates or the extraction period ends, the contractors must complete the allocation and transfer of the decommissioning security fund.

Non-Operator Liability

The decommissioning security fund shall be managed by the PVN in a manner that is in accordance with the regulations of law, and should meet requirements for decommissioning according to the approved decommissioning plan. In the period of using this fund, the PVN shall pay the fund’s money amount into a commercial bank in which the State holds a controlling interest; interests generated annually after fulfilling financial obligations according to relative laws shall be recorded as an increase in the decommissioning security fund.

Prior-Owner Liability

Prior owners or operators retain certain liabilities even after fully divesting their ownership interest in a petroleum licence. This includes liability for any environmental damage or non-compliance that occurred during their period of ownership.

The transfer of ownership must be approved by the MOIT, and the new owner must demonstrate the capability to meet all decommissioning obligations.

The Vietnamese legal system currently does not have a specific law on climate change. However, relevant provisions in other legal documents addressing greenhouse gas emission reduction and environmental protection impact the oil and gas industry. These regulations require oil and gas projects to conduct EIAs and implement measures to prevent and respond to environmental incidents. Additionally, Decision No 896/QD-TTg, dated 26 July 2022 and approving the National Strategy for Climate Change until 2050 by the Prime Minister, sets greenhouse gas emission reduction targets for Vietnam, which may indirectly affect oil and gas activities. These measures promote environmental responsibility within the sector, contributing to Vietnam’s broader climate change mitigation efforts.

In Vietnam, local governments must comply with regulations, policies and directives from the central government related to oil and gas development. However, local governments can impose restrictions on oil and gas activities based on environmental or community safety factors, as long as they are in accordance with national legal regulations. Accordingly, local authorities can undertake a number of activities, as follows:

• implementing and monitoring environmental protection regulations within the locality – this includes granting environmental licences, revoking environmental licences according to authority, and monitoring and handling environmental violations for oil and gas projects; and
• in addition, oil and gas projects must conduct EIAs, and local governments have the right to participate in the assessment and to approve or propose measures to minimise environmental impacts.

Vietnam does not have specific laws related to energy transition. Nevertheless, the Prime Minister issued Decision No 768/QD-TTg dated 15 April 2025 on approving the amendment to national electricity development planning for the 2021–2030 period as well as the vision towards 2050. The Eighth National Power Development Plan (PDP VIII) represents Vietnam’s ambitions in transitioning to renewable energy.

Vietnam is in the early stages of transitioning from oil and gas to energy transition projects, and there are ongoing efforts to utilise oil and gas upstream and midstream assets for energy transition projects, such as:

• carbon capture, utilisation and storage (CCUS);
• renewable natural gas (RNG);
• sustainable aviation fuel (SAF); and
• hydrogen.

While the utilisation is currently limited, several pilot projects are in progress, such as the green H2 of PV GAS, and the Block B, Blue Whale and Son My LNG gas-to-power project chains.

Advanced technologies are being adopted in upstream and midstream operations to minimise greenhouse gas emissions, and there are support programmes for developing renewable energy sources such as wind and solar power. Vietnam is also working on creating a legal framework, financial support mechanisms and tax incentives to encourage the energy transition.

According to Decision No 768/QD-TTg, amending the Eighth National Power Development Plan (Revised PDP VIII), Vietnam’s energy transition is driving significant changes in its traditional oil and gas sector. The revised plan considerably raises renewable capacity targets while reducing dependence on conventional coal-fired and fossil fuel-based power. As a result, state-owned enterprises such as the PVN are diversifying their portfolios by increasingly investing in LNG projects and renewable energy ventures such as wind and solar power.

This policy shift also accelerates the development of natural gas infrastructure, as LNG is recognised as a key transition fuel. Enhanced investment in emission reduction technologies – including carbon capture, utilisation and storage – further underscores the imperative for cleaner operations. These changes affect all segments of the oil and gas value chain – upstream, midstream and downstream – by pushing companies to adopt more sustainable practices.

Currently, there is no specific programme in Vietnam dedicated to unconventional upstream interests. Exploration and exploitation activities for oil and gas in general are still subject to the provisions of the Petroleum Law 2022 and detailed guiding documents.

Vietnam currently does not export LNG but is focusing on importing to meet domestic demand. Recently, Decree No 100/2025/ND-CP issued on 8 May 2025, amending and supplementing Decree No 56/2025/ND-CP, established a clear legal framework for investors developing power projects, and clarified the cost recovery mechanism for projects using LNG and a clearly structured bidding process to improve transparency, capital mobilisation and feasibility in investing in power projects. This Decree also regulates prioritising infrastructure development of LNG import terminals in a manner compliant with the centralised LNG terminal model, with high-capacity and regasified LNG pipeline systems installed from centralised LNG terminals to thermal power plants, in order to optimise shared infrastructures.

Furthermore, the Revised PDP VIII focuses on accelerating the progress of LNG power projects – especially the Nghi Son LNG, Ca Na LNG and Quynh Lap LNG projects – while developing LNG import infrastructure. In addition, the Revised PDP VIII also prioritises the development of renewable energy sources – especially wind and solar power – and may postpone some LNG projects due to delays in selecting investors or delays in procedures.

Recognising the crucial role of the oil and gas industry in the socio-economic development of the country, the government of Vietnam has been implementing numerous preferential policies to attract foreign investment in this sector. This is a strategic move to effectively exploit the vast potential of oil and gas resources, particularly natural gas and LNG in the East Sea area.

With a national energy development orientation towards sustainable goals, Vietnam is prioritising the development of clean and environmentally friendly energy sources. In the context of the increasingly depleting traditional fossil fuel supply and the escalating negative impacts of climate change, natural gas and LNG emerge as potential alternative energy solutions.

In addition to resource potential, Vietnam possesses many other advantages that attract foreign investors to the oil and gas sector, especially as there are specific investment development policies for each province.

Currently, the Petroleum Law 2022 remains in effect and serves as the legal foundation governing fundamental petroleum surveys and petroleum operations within the mainland, islands and maritime zones under the sovereignty of the Socialist Republic of Vietnam. Accordingly, there have been no significant changes in the legal or regulatory framework related to the oil and gas sector over the past year.