Government asks BP to start Tangguh gas project in April

BP Migas, the government’s agency in charge of supervising oil and gas exploration and production activities, hoped that the development of the Tangguh gas field in Papua can be started in April, this year, Neraca daily reported on Friday.

To ensure that the gas project could be started in April, the government had asked BP Indonesia (the dominant shareholder of the project) to use its own funds to start the development of the gas project. “We hope BP Indonesia can use its own funds while waiting for the loan disbursement from banks,” the chairman of BP Migas, Rachmat Soedibjo said in Jakarta on Thursday.

BP Indonesia’s president Bill Schrader has earlier said he was quite optimistic that with the increase in China National Oil Offshore Corporation's (CNOOC) stake in the Tangguh project following the purchase of British Gas Group’s shares, more financial agencies from China and Japan would be interested in providing loans for the gas project.

Rachmat said that his office had also asked the Ministry of Energy and Mineral Resources to approve the plan of the development of the project before the end of March so that the project could begin in April.

A number of buyers have signed agreements to buy Liquefied Natural Gas (LNG) from the Tangguh project. China’s Fujian province will buy 2.6 million tons a year, Korea’s SK Posko to buy 1.2 million tons a year and a number of companies based in the western coast of the United States to buy US$3.6 million. (*)