Tangguh sends first LNG to South Korea

The Tangguh LNG plant in West Papua has finally made the first shipment of its product to South Korea.

The maiden export carried on Monday by the Tangguh Foja vessel to the LNG terminal in Gwangyang, South Korea, owned by giant steel producer POSCO took place four years after the project got an official approval from the Government of Indonesia in March 2005.

?The maiden LNG cargo delivery marks an important momentum in the history of national oil and gas upstream sector. As Indonesia?s third LNG center, the first cargo shipment is expected to be able to strengthen Indonesia?s position as one of the world?s LNG producer.

?Aside from being a source of income for the state, the Tangguh project is expected to become a pioneer for the development of strategic industry in eastern Indonesia,? BPMIGAS? chairman R Priyono said in a statement.

The US$5 billion project is considered a success because it was finished on time despite its remote location which lack infrastructure. At the peak of the project, it absorbed 10,000 workers.

BP Indonesia?s President William Lin says: ?This important achievement directly results from the integrated combination of skills and commitment of Indonesian and foreign employees, partners and contractors. The Tangguh LNG is a paramount example of what can bed achieved through tight project management and planning, which is fully supported by the government and local people.?

The Tangguh LNG plant gets gas from six fields, including Wiriagar, Berau, Muntuni. The gas is produced at two unmanned offshore rigs and channeled through a 22-kilomter to two LNG trains, each with the capacity of 3.8 million tons per year. Train 1 started LNG production for the maiden cargo shipment in the middle of June, while Train 2 is scheduled to start operation this quarter, according to BPMIGAS.

Tangguh is operated by BP Indonesia with ea 37.16 percent stake. Its partners include MI Berau B.V. (16.3 percent), CNOOC Ltd (13.9 percent), Nippon Oil Exploration (Berau) Ltd (12.23 percent), KG Berau/KG Wiriagar (10 percent), LNG Japan Corporaation (7.35 percent) and Talisman (3.06 percent)

The project has signed long term contracts with LNG Fujian in China (2.6 million tons per year), K-Power and POSCO in South Korea (1.15 million tons) and a flexible contract to supply up to 3.7 million tons per year to the Sempra LNG terminal in Baja California, Mexico.

The main contractors of the project are the consortium of KBR (through its Indonesian subsidiary PT Brown & Root Indonesia), JGC Corporation and PT Pertafenikki, which is better known as the KJP consortium, which handles the construction of onshore facilities; and Saipem which handles the construction of offshore and underwater facilities.

The project?s owner has involved local people in the construction works, carried out integrated social programs for the local communities and is committed to provide works for the local people during the operational phase and continue social programs. (*)