Train 3 construction to kick off in October
Wednesday, August 3 2016 - 04:13 PM WIB
The construction of Train 3 of the Tangguh LNG plant in West Papua province is scheduled to kick off in October of this year.
?We expect to sign the EPC contract early next month and then prepare the contractors for groundbreaking in the fourth quarter of the year,? BP Indonesia?s Country Manager Dharmawan Samsu said on Wednesday, adding the project is expected to come onstream in 2020
An official of upstream authority SKK Migas said President Joko Widodo will be invited to break ground on the project.
On Wednesday, BP Berau Ltd signed a syndicated loan agreement worth US$3.745 billion with a number of local and international banks. The loan is part of a total of $8 billion funds needed for the project.
The $3.745 billion syndicated loan will be provided by the lenders through Trustee Borrowing Scheme (TBS). Domestic lenders participating in the syndicated loan include PT. Bank Mandiri Tbk., PT. Bank Negara Indonesia Tbk., and PT. Bank Rakyat Indonesia Tbk., and PT. Indonesia Infrastructure Finance. Meanwhile, international lenders include affiliates of Mizuho Bank, Bank of China, China Construction Bank, The Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corporation, DBS Bank, United Overseas Bank, BNP Paribas, Credit Agricole Corporate and Investment Bank, Oversea-Chinese Banking Corporation, Korea Development Bank, Shinsei Bank, and KfW Bank.
?The funds will be used only for the construction of onshore facility of the LNG plant. Meanwhile, the funds for offshore gas production facility (GPF) will be provided through equity financing scheme. TBS scheme will only applied for onshore facility,? Dharmawan said.
Meanwhile, SKK Migas? Chairman claimed the project, better known as Tangguh Train 3, has gained international attention because it is the only LNG project that still runs amid the oil price crash.
?We must be proud of ourselves, because to the international community, this project is exceptional. (Since the start of oil price crash) until August of this year, there aren?t an LNG projects which have their FIDs approved, except for Tangguh Train 3. It?s not me who said this, but the chairman of International Energy Association. He showed me the data, which shows investment around the world is still put on hold. But in Indonesia, we have Tangguh Train 3, that still runs,? he said.
Editing by Johannes Simbolon