BP sees no need for extra LNG trains<\/p>\n
Fitri Wulandari, The Jakarta Post, Jakarta<\/p>\n
BP Indonesia, a unit of Anglo-American energy giant BP Plc.,
\nsaid it does not have any plans to build additional liquefied
\nnatural gas (LNG) trains although it had secured LNG supply
\ncontracts that were larger than planned capacity.<\/p>\n
\"We would carefully consider any plan to build additional an
\nfacility. But at the moment we are sticking to our plan of
\nbuilding two LNG trains,\" Jacob Kastanja, BP's Tangguh
\ncommunications unit manager told The Jakarta Post over the
\nweekend.<\/p>\n
BP is planning to build two LNG trains with a total capacity
\nof seven million tons per year at its Tangguh gas field in Papua
\nprovince.<\/p>\n
Last week, the company signed a 20-year preliminary contract
\nwith U.S.-based Sempra Energy, under which it would supply some
\n3.7 million tons of LNG per year to the latter company starting
\n2007. This boosts BP's LNG supply contract to date to 7.4 million
\ntons pear annum. The company previously won a 2.6 million ton per
\nannum contract from China's Fujian Province, and another 1.1
\nmillion tons per year (not 1.5 million tons as earlier reported
\nby this paper) from South Korean buyers: SK and Posco.<\/p>\n
Jacob said BP would maximize the two planned LNG trains, but
\nfell short of providing details on how to maximize the
\nfacilities.<\/p>\n
LNG is natural gas which is cooled to turn it into liquid form
\nfor transportation using tanker ships. The gas then is regasified
\nand distributed through pipelines.<\/p>\n
But Jacob added that in the future BP could expand the plant
\ncapacity based on customer demand.<\/p>\n
\"Any plans for expansion will be based on customer needs,\" he
\nsaid.<\/p>\n
Jacob said the company is preparing the construction of the
\nTangguh LNG facility, which will start next year. This will be
\nIndonesia's third LNG plant.<\/p>\n
A consortium consisting of Japan's JGC Corp., U.S. Kellog
\nBrown & Root, and local company Pertafenikki Engineering won a
\ntender to build the LNG plant, which is expected to enter into
\nfull operation in 2007.<\/p>\n
Indonesia already has two LNG plants, namely Bontang in East
\nKalimantan and Arun in Aceh province, which have a combined
\ncapacity of 31.6 million tons per year.<\/p>\n
Jacob said that securing the U.S. contract had given
\nconfidence to the Tangguh consortium after the project had been
\nin limbo for some time as it had only received a small number of
\norders. Creditors have been reluctant to provide funds for the
\nproject because of the slow progress being made, analysts have
\nsaid.<\/p>\n
Securing the contract also confirms Indonesia as one of the
\nworld's top LNG producers. Entering the U.S. market, the largest
\nenergy consumer in the world, will boost Indonesia's profile. The
\nU.S. Energy Information Administration forecasts U.S. imports of
\nLNG will grow to 4.8 trillion cubic feet in 2025, which is much
\nhigher than the estimated 540 billion cubic feet in 2003.<\/p>\n
This will provide significant revenue for the government.
\nUnder the contract with Sempra Energy, for instance, the
\ngovernment would bag a total of $10 billion in revenue. Under the
\nproduction sharing contract, the central government will receive
\n70 percent of Tangguh's after-tax revenue and Papua province will
\nreceive 70 percent of the central government's revenue share.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bp-sees-no-need-for-extra-lng-trains-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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