LNG plant secures $1.12b loan

LNG plant secures $1.12b loan

TAIPEI (DPA): The Bank of Taiwan on Saturday announced a 1.12- billion-dollar loan Saturday for the construction of the world's largest liquefied natural gas (LNG) plant in Indonesia.

The bank will underwrite the syndicated loan, which also involves the Banque Indosuez, Chase Manhattan Bank and four Japanese lending institutions.

The loan will finance the construction of an eighth LNG processing line in the East Kalimantan city of Bontang by the Indonesian state oil firm Pertamina.

The company already has six such lines in the area and a seventh is under construction.

Pertamina needs to add an eighth line to meet demands created by its new 20-year LNG sales contracts with Taiwan's Chinese Petroleum Corporation and South Korea's Korea Gas Corporation. The Bank of Taiwan is contacting nine Taiwan banks to participate.

Syndication of the financing is expected to begin soon and will be closed by the end of February.

Construction on the project is to begin in March and will be completed on Nov. 30, 1999. The new plant would produce an expected 2.95 million tons of liquefied natural gas per year.