RI has small chance to win China's LNG project: report

Chance is slim for Indonesia to win the contract for the supply of liquefied natural gas (LNG) to China, international news agency Bloomberg quoted analysts and Australian LNG marketer as saying.

Arthur Dixon, the president of Australia LNG, the country's LNG marketer, and Fanton Chuck, an analyst in Singapore with Alliance Capital Management, said Indonesia, the world's largest LNG exporter, was not in a position to compete to win the Chinese LNG project following problems faced by the country.

"You can almost count Indonesia out now," Chuck said, adding that Indonesia's LNG plants in "Bontang and Arun are clearly not in a position to compete."

Dixon also considered Indonesia was not a rival for Australia to win the LNG project, adding the biggest rival was Qatar, followed by Malaysia and Brunei.

"They (Qatar) have shown themselves to be fairly competitive on price," Dixon said. Still "they have the disadvantage that they are further away.".

Dixon said Australian LNG is now in talks with Chinese state oil and gas company China National Offshore Oil Corp (CNOOC) to sell a stake in Australia's North West Shelf gas fields as a strategy to win the LNG contract.

Indonesia is seeking to supply China with LNG from the planned Tangguh LNG plant in Irian Jaya, which is controlled by Anglo American energy firm Beyond Petroleum (BP).

BP has also a one-sixth stake in the North West Shelf LNG plant.

China earlier chose BP to co-build its LNG plant in Shenzen, near Hong Kong, raising the chance for BP to win the Chinese LNG contract. But, the Chinese government asked BP for a stake in its LNG plant.

It remains unclear which stake BP would offer to China. (Bodega)