Hanoi (VNA) - Prime Minister Nguyen Xuan Phuc has halted constructionof the 10.6-billion USD Hoa Sen Ca Na steel plant insouth-central province of Ninh Thuan, while requiring morestudies to be completed on the consumer demand and the environmentalimpact of the plant.

A statement from the Government Office has cited Phuc as saying that thepreparations for the project had been too “hasty” and had only provided apreliminary assessment.

Accordingly, he asked the province to clarify the effects on the environment,domestic steel demand, as well as the total investment of the project.

He further said all parties should carefully review the planning of steelplants, material supplies and suitable time and scale for the construction.

In addition, they also need to assess the technology and possibleenvironmental impacts to prevent a disaster similar to the one caused byTaiwan’s Formosa, he said, adding that the Ca Na project can proceed if studiesprove it is viable.

The project should also clarify how it fits in the overall development of deepseaports, railways and roads.

The PM noted that the project was proposed after the Formosa scandal, thusmaking it “very sensitive”.

Earlier, the public voiced concerns that the project, which will produce about16 million tonnes of products per year, might harm the environment.

Also, Vietnamese citizens worried that the project near the sea could bringabout damages similar to those caused by Taiwanese steel firm Formosa  along the central coast, which resulted in massive fishdeaths earlier last year.

The Ca Na construction of the project was expected to be done in five stagesbetween 2017 and 2031. The first stage would begin operation in 2019, takeup an area of 240ha, and enable a manufacturing capacity of 1.5 milliontonnes per year. Hoa Sen Group leaders said the company would try to minimiseenvironmental impacts with various measures, including approaches that savematerials and optimise production capacity.

Almost 97 percent of Hoa Sen shareholders approved construction of the mammothsteel plant.

The company, based in the Song Than 2 Industrial Zone in the southern provinceof Binh Duong, reportedly represents 40 percent of the steel sheetmarket and 20 percent of the steel pipe market in Vietnam. It exports productsto 65 countries and territories.

Minister of Industry and Trade Tran Tuan Anh told a meeting with nationallegislators in November last year that steel plants will not be built at thecost of the environment. The ministry has included construction of the plant ina national steel development plan for 2025, with a vision toward 2035, despitethe project not being officially licensed.-VNA