BP to invest another $10 billion in Indonesia

The London-based oil and gas giant BP Plc will invest another US$10 billion in Indonesia in next 10 years to further increase its liquefied natural gas (LNG) production and to expand into coal-bed methane production, the company?s top executive said.

Speaking to reporters following a meeting with President Susilo Bambang Yudhoyono in Jakarta on Friday, BP?s Chief Executive Officer Bob Dudley said the company planned to build a third LNG production line, or train, and possibly a fourth at its Tangguh LNG plant in Papua.

BP, which has operated for more than 35 years in Indonesia, has invested $7 billion in the country to date, he said.

?Our focus in investment is Tangguh in Papua, which we know we handle with great care as that?s already a very large project for BP,? Dudley was quoted as saying by Bloomberg. He said that BP would submit a proposal to the Indonesian government in the next two months for the construction of the third train.

BP will develop coal-bed methane blocks in Kalimantan Dudley said. BP said in April it had signed four coal-bed methane production sharing contracts in the Barito basin.

The Tangguh LNG plant in West Papua province currently has two trains with a combined production capacity of 7.6 million metric tons of LNG a year, BP said on its website.

The $5 billion Tangguh project, which shipped its first LNG cargoes in 2009, has multi-year contracts to supply 2.6 million tons a year to China, 1.15 million tons a year to South Korea and an agreement to supply as much as 3.7 million tons a year to Sempra Energy, BP said. (*)