Potentiality of Jiangshu LNG market confirmed

Indonesian LNG marketing team, which visited the Chinese province of Jiangshu recently had met with the province?s authorities and had confirmed the potentiality of the province?s LNG market.

A member of Indonesian team who did not wish to be named said that the province had the potential to absorb 2 million tons of LNG in the first year, ramping up to 5 million tons. ?The province is planning to build LNG receiving terminal,? said the source.

The source said that Hong Kong-based energy company Pacific Oil & Gas Limited is eyeing to be the LNG importer and co-owner of the proposed LNG receiving terminal and re-gasification facilities.

Pacific, which is controlled by Indonesian pulp and paper magnate Sukanto Tanoto is proposing to build and operate the ninth LNG plant in Bontang, East Kalimantan as the source of LNG supply to Jiangshu. Under the scheme, Pacific will buy natural gas from East Kalimantan gas producers, process the gas in the LNG plant it built and ship the LNG to Jiangshu. Pacific had secured principle agreement to build the train.

East Kalimantan gas producers includes Total SA, Vico Indonesia and Unocal Corp.The three producers supply some 3.7 BCFD of natural gas Bontang LNG plant.

The source expected after the visit, negotiation would intensify and would lead to further agreement.

The source hinted that the Jiangshu receiving terminal and regasification facilities is slated to be completed by around 2008.

Indonesia, currently the biggest LNG exporter is desperately looking for new markets to replace its dwindling shares in traditional markets amid the emergence of new LNG producers. (godang)