Indonesian negotiators to court Japanese and Chinese creditors on Tangguh project

A group of officials from the upstream oil and gas authority BPMIGAS and oil and gas producer BP Plc. will meet this week with leaders of Japanese and Chinese banks and request them to finance the development of BP-operated Tangguh gas field in Papua, a BPMIGAS official told Petromindo.Com Monday.

"The team will leave for Japan and China this week. We will meet with leaders of Japan Bank for International Cooperation and Chinese banks," said Eddy Purwanto, BPMIGAS' deputy chairman for financial and economic affairs.

Eddy did not mention the names of the Chinese banks, however.

The government reportedly had asked BP and Tangguh interst holders to start developing Tangguh LNG plant in April and use their own funds for it while waiting for loans from creditors.

Thus far Tangguh had secured two firm LNG supply deal; one with Chinee province of Fujian (2.6 MTPA) starting 2007 and with South Korean companies SK and Posco (1.1 MTPA). Another deal with US energy trader Sempra Energy is being finalized. Tangguh is also eyeing opportunities to supply LNG to Japan, world's number one LNG importer.

The Tangguh project reportedly neeed billion of dollars in credit. The project is slated to commence in 2007 with first two trains with comabined capacity of around 7 MTPA.

Meanwhile, Eddy said Monday that during their visit to China they would also seek opportunities to market liquefied natural gas (LNG) to China's Guangzhou province.

BP Plc is the operator of Tangguh, but China National Offshore Oil Corporation (CNOOC), together with several Japanese companies are majority interestholder the project.

Earlier, a BP Plc official told Petromindo.Com that financing deals with Japan and Chinese creditor are exepected to be closed within few months.(godang)