The petroleum framework and Petrovietnam: Law No. 12/2022/QH15 and Decree No. 45/2023/ND-CP, the roles of the Prime Minister, the Ministry of Industry and Trade and the Vietnam National Industry - Energy Group, blocks and open acreage, the operating office, midstream and downstream activities, and the new Petroleum Law No. 10/2026/QH16

Ownership and the legal framework

Oil and gas, like minerals, are owned by the entire people with the State as owner's representative under Article 53 of the Constitution. Unlike minerals, they are not licensed. The State develops them through a petroleum contract signed on its behalf by Petrovietnam with one or more contractors, who carry the exploration risk in return for a share of production (FAQ 102). The framework is Law No. 12/2022/QH15 on Petroleum, passed on 14 November 2022 and in force since 1 July 2023, which replaced the Petroleum Law of 1993 and its amendments, and Decree No. 45/2023/ND-CP of 1 July 2023, which details contractor selection, contracts, safety, approvals, incentives, tail-end production and cost settlement and annexes a model production sharing contract and its accounting procedure (FAQ 101).

The law covers basic petroleum surveys (Articles 10 to 14), contractor selection (Articles 15 to 25), petroleum contracts (Articles 26 to 41), operations including field development and decommissioning (Articles 42 to 52), incentives (Articles 53 to 55), accounting and cost settlement (Articles 56 and 57), the rights and obligations of contractors (Articles 58 and 59), Petrovietnam (Articles 60 to 64) and State management (Articles 65 and 66). Article 4 gives the Petroleum Law priority over other laws on petroleum matters and allows the parties to apply foreign law and international petroleum industry practice where Vietnamese law is silent, provided the result is not contrary to Vietnamese law. Corporate income tax, natural resources tax and export duty are levied under the tax laws but with petroleum-specific rules, explained in Petroleum contracts and fiscal terms.

The Prime Minister and the Ministry of Industry and Trade

Under the 2022 law the decisions of most consequence rest with the Prime Minister: approval of each petroleum contract (Article 26), the list of blocks and fields eligible for investment incentives and special investment incentives (Article 53(3)), approval of transfers of participating interests that require it (Article 36), and the specific CIT rate for each contract within the 25% to 50% range under Article 10(4)(a) of Law No. 67/2025/QH15. The Prime Minister also decides cases outside the ordinary limits, such as longer contract terms for defence or complex geology.

The Ministry of Industry and Trade is the State management authority for petroleum (Article 65). It approves the block list and contractor selection plans prepared by Petrovietnam, appraises petroleum contracts before they go to the Prime Minister, issues and adjusts the contractor's Investment Registration Certificate (Article 27), and approves the outline development plan, the field development plan, early production plans and the decommissioning plan (Articles 46 to 50). It inspects safety and supervises compliance. Government Resolution No. 66.6/2025/NQ-CP delegated some of MOIT's approvals to Petrovietnam until 28 February 2027, as part of the Government's programme of removing procedural obstacles, so for that period certain plans are approved by PVN rather than by the ministry (FAQ 110).

Petrovietnam

Petrovietnam was renamed the Vietnam National Industry - Energy Group (Tập đoàn Công nghiệp - Năng lượng Quốc gia Việt Nam) by Decision No. 733/QD-TTg of 9 April 2025, reflecting its expansion into power and industry, but it is still widely known as Petrovietnam or PVN, and the Petroleum Law refers to it in its own right. It wears two hats. As the State's contracting party under Articles 60 to 62 of the law, it organises basic surveys, prepares the block list and selection plans, negotiates and signs every petroleum contract, manages and supervises contractors, approves annual work programmes and budgets, audits and settles petroleum costs, receives and sells the State's share of production where the contract so provides, and holds the decommissioning fund. As a commercial group, through subsidiaries such as its exploration and production arm, it is also an investor that may take participating interests.

The two roles meet in Article 39, which gives Petrovietnam the right to participate in a contract after a commercial discovery, on the terms the contract sets, and a pre-emption right when a contractor transfers a participating interest. A foreign oil company should treat PVN as regulator, partner and potential co-venturer at once, and should negotiate its contract on that footing. Law No. 10/2026/QH16 is intended to separate the functions PVN performs for the State from its role as an investor more clearly (Decommissioning, local content and the 2027 Petroleum Law).

Blocks, open acreage and how contracts are awarded

Vietnam's offshore is divided into blocks. Petrovietnam prepares, and the competent authority approves, the list of blocks available for contract under Chapter III of Decree No. 45/2023/ND-CP, distinguishing open blocks from those already under contract and identifying blocks on the Prime Minister's list of incentivised and specially incentivised blocks under Article 53 of the law. Blocks qualify for incentives because they are deepwater, far offshore or geologically complex, because they attracted no bids under ordinary terms, because they are made up of relinquished acreage or marginal fields, or, for special incentives, because they target unconventional petroleum or failed to attract bids under incentivised terms.

Contractors are selected under Article 15 by open bidding, restricted bidding, competitive offer or direct appointment, under a selection plan approved for the block, and bidders must have the financial and technical capacity and petroleum experience required or bid in a consortium that has them (Article 16). Both Vietnamese and foreign companies may bid. After selection Petrovietnam negotiates the contract, MOIT appraises it, and the Prime Minister approves it; approval of the contract replaces investment policy approval, and MOIT then issues the contractor's IRC (FAQ 111). The detailed procedure and the terms of the contract are in Petroleum contracts and fiscal terms. Open blocks, bidding rounds and the incentivised-block list are announced through MOIT and Petrovietnam (FAQ 115).

What a foreign contractor sets up in Vietnam

A foreign oil company does not need to form a Vietnamese company to be a contractor; it contracts directly with Petrovietnam. If it is the operator, Article 38 requires it to establish an operating office in Vietnam, registered with the competent authority, with its own seal and bank accounts, through which it conducts petroleum operations, employs staff and contracts with suppliers. The contractors' cash calls are paid into a joint account opened in Vietnam by the operator (Article 59(9)). Non-operating partners participate through the contract without a separate presence, although many establish representative offices.

The contractor holds an IRC issued by MOIT for the contract (Article 27), which is adjusted when the contract or the contractor group changes (Article 28). Its foreign staff need work permits, which petroleum operators obtain under the ordinary rules (Work permits for foreign staff), and its payments to foreign subcontractors bear foreign contractor tax (Foreign contractor tax and tax treaties). Profits and cost recovery are taken in kind or in cash under the contract and remitted under the foreign exchange rules (Profit remittance and repatriation of capital).

Midstream and downstream in outline

The Petroleum Law governs the upstream: surveys, exploration, development, production and decommissioning, including the transport of petroleum within the contract area. It does not govern refining, petrochemicals, LNG import terminals, gas-processing plants outside a field development, pipelines serving the domestic market or gas-fired power stations. Those are ordinary investment projects. Oil and gas processing projects are among the categories in Article 24 of Law No. 143/2025/QH15 that require investment policy approval before the IRC (Investment policy approval), and they need land, environmental and construction approvals and, for terminals, port and maritime approvals.

Gas-fired and LNG-to-power projects also need an electricity operation licence and must fit the national power development plan under Law No. 61/2024/QH15 on Electricity, with Vietnam Electricity (EVN) as the main buyer and grid operator; National Assembly Resolution No. 253/2025/QH15 adds special mechanisms for power projects for 2026 to 2030 (FAQ 93). The trading of petroleum products and gas in the domestic market is a conditional business regulated by MOIT. The link with the upstream is Article 59(8) of the Petroleum Law, which requires a contractor to sell its share of gas under gas development projects, and its crude at internationally competitive prices, in the Vietnamese market when the Government so requires; gas sales agreements for domestic power plants are negotiated against that background.

The new Petroleum Law in outline

Law No. 10/2026/QH16 on Petroleum was passed at the National Assembly's first extraordinary session of the sixteenth legislature on 23 August 2026, with 473 of 475 deputies voting in favour, and takes effect on 1 March 2027, replacing Law No. 12/2022/QH15. It has 12 chapters and 62 articles and largely carries over the 2022 structure. According to MOIT's public briefing in September 2026, its core changes are greater decentralisation to the State management authority and the delegation of powers to Petrovietnam, with simplified procedures balanced by stronger inspection; additional incentives for small and marginal fields and for deepwater and far-offshore projects; encouragement of enhanced recovery and tail-end production; a framework for carbon capture and storage and for offshore energy and shared infrastructure linked to petroleum operations; more flexible contracts allowing extensions and adjustments of work commitments; and accounting, audit and cost settlement rules aligned with international practice. Powers touching defence, security and force majeure stay with the competent authorities.

The text, and the decree MOIT is preparing to take effect on the same date, will decide which approvals move from the Prime Minister to MOIT or PVN and how existing contracts are treated. Those points are discussed, with appropriate caution, in Decommissioning, local content and the 2027 Petroleum Law. Until 1 March 2027 every new contract, transfer and plan is governed by the 2022 law and Decree No. 45/2023/ND-CP.