BP expects China to open LNG supply tender in October

Indonesian unit of Anglo-American energy giant BP Plc said Thursday it expected China to open bid to supply liquefied natural gas (LNG) to Guangdong province in late September or October this year.

BP, which already has some stake in Guangdong LNG receiving terminal hopes to win the LNG supply tender in order to be able to build LNG plant in Tangguh, Irian Jaya, where, together with its partners, BP has proven gas reserves of 14.4 trillion cubic.

BP faces heavy competition from other LNG suppliers such as Qatar, Australia, Malaysia and Russia.

Guangdong will initially take 3 million tons of LNG a year.

BP and partners plan to open the Tangguh plant with two LNG trains with 3 million tons per annum capacity each.

BP Indonesia president Bill Schrader said BP did not need the entire plant capacity to be sold out before it proceed with LNG plant construction as it was optimistic to able to market the remaining capacity to other buyers before the project became on stream in 2005.

?However, we do need some commitments before we go ahead with plant construction, which we are hopeful to get from China,? he said.

Schrader said BP with state oil and gas company Pertamina had also held talks with other existing Indonesian LNG buyers in Japan and other places about the possibility of supplying LNG from Tangguh.

Schrader said so far, their responses were ?very good?.

?Existing customers see Tangguh as opportunity for diversification of supply from Indonesia. The development of Tangguh will allow Indonesia to have three LNG center and boost supply security,? he said. (alex)