Tangguh project has huge gas reserves
Tangguh project has huge gas reserves
TOKYO (Dow Jones): Japan's Nippon Oil Co. announced yesterday the Tangguh liquefied natural gas project in Irian Jaya, Indonesia -- in which it holds a stake -- has proven and probable reserves in its three production sharing contract blocks, of 18.3 trillion cubic feet.
Following a 12-month exploration program, the Tangguh project partners announced proven reserves are 14.4 trillion cubic feet of natural gas, with probable reserves of 3.9 trillion cubic feet, a Nippon Oil official said.
The Tangguh LNG project consists of three production-sharing blocks in Irian Jaya including Muturi Block which is operated by BG PLC (BRG) and Wiriagar and Berau blocks which are both operated by Atlantic Richfield Co., or Arco (ARC).
Nippon Oil has a 17.144 percent stake in the Berau Block whose combined proven and probable reserves are about 12.4 trillion cubic feet.
Under the contract with Indonesia's state-run oil company Pertamina, the international project partners will supply the entire amount of liquefied natural gas from the blocks to Pertamina, the official said.
The total proven and probable reserves of 18.3 trillion cubic feet of natural gas at the three blocks mean that the Tangguh project will be able to yield more than 9.0 million tons a year of LNG, the Nippon Oil official said.
Given the successful development efforts so far, the project partners plan to commence commercial production of 6.0 million tons a year of LNG in 2003-2004, the official said.
Pertamina has been targeting its LNG supplies from the Tangguh project to three main potential buyers: Japanese utilities, South Korean utilities, and China's state-owned China National Offshore Oil Corp.
Aiming to exploit upstream energy businesses in the Asian- Pacific region, Nippon Oil has been involved in several major oil and gas development projects in the region, including a concession stake off northwestern Australia, the Yetagun gas project in Myanmar, a liquefied natural gas project at Irian Jaya, Indonesia, as well as the two liquefied natural gas projects -- Tiga and Deepwater Sarawak -- in Malaysia.
"The projects that we have been engaged in are set to move forward soon one after another... Myanmar in 2000, Malaysia Tiga in 2001, and Irian Jaya possibly in 2003," said the Nippon Oil official. "Those upstream projects will benefit Nippon Oil significantly in the next century," he added.
Meanwhile Malaysia's Genting Bhd., through its subsidiary Cairns Ltd., and British Gas Plc (BRG) said that they have raised their stake in the Muturi production-sharing contract off the coast of Irian Jaya, Indonesia.
The companies acquired the 5 percent stake held in the Muturi block by P.T. Sapta Patra Wisesa for an undisclosed amount, sharing the stake equally in proportion to their stakes in the block.
BG Exploration & Production Ltd. now holds a 52.63 percent stake in the block, for which it acts as operator, while Cairns holds 47.37 percent.
Genting announced Tuesday that the Muturi block holds proven gas reserves of 3.1 trillion cubic feet and proven and probable reserves of 3.8 trillion cubic feet.
Muturi is one of three blocks in Irian Jaya being jointly explored and developed by operators BG and Atlantic Richfield Co. (ARC). Reserves in the three blocks were upgraded by engineering firm DeGloyer & MacNaughton on July 31. The companies plan to develop the reserves through Indonesian state oil and gas company Pertamina's Tangguh liquefied natural gas project, scheduled to begin LNG deliveries in 2003-2004.
Genting officials said the Vorwata field located on the Irian Jaya blocks ranks as the third-largest gas field in Indonesia behind the Natuna D-Alpha and Arun fields, and it may exceed Arun in reserves as development continues.