Update: Purnomo says S. Korea LNG success due to intensive lobby

Minister of energy and Mineral resources Purnomo Yusgiantoro said that Indonesia?s success to secure LNG contract from South Korean companies SK Corp and Posco was due to combination of attractive terms and conditions and intensive lobbying by the government.

?The success of Tangguh to secure LNG contract because we have good relationship with South Korean government and business circles,? said beaming Purnomo when interviewed by Petromindo.Com.

He further said LNG sales and purchase agreement would be signed soon.

South Korea?s top oil refiner SK Corp. and steel maker Posco had just picked BP Plc.-operated Tangguh LNG project in Papua province as winner to supply 1.1 million tons of LNG annually for 20 years starting 2005. Tangguh defeated Petronas? Malaysia Tiga LNG.

Early last week, Purnomo led Indonesian delegation to visit South Korean energy minister and held talk with SK and Posco top leaders.

Tangguh project has been scrambling to find buyers for its LNG to secure adequate volume to justify the construction of the plants, which is scheduled to commence early next year. Tangguh has thus far bagged the 2.7 MTPA supply contract to the Chinese province of Fujian and is searching to double the contract volume. Tangguh was recently defeated by Qatar?s RasGas in the 1.8 MTPA supply tender to Taiwan?s TaiPower.

Tangguh is scheduled to commence production in 2007 with initial capacity of 7 million per annum. LNG supply for SK-Posco contract in 2005 and 2006 would be sourced from Bontang LNG in East Kalimantan. (alex/godang)