RI, PNG explore cooperation in LNG | The Jakarta Post

RI, PNG explore cooperation in LNG | The Jakarta Post

State-owned oil and gas company Pertamina and its Papua New Guinea (PNG) counterpart, National Petroleum Company Papua New Guinea (NPCP), agreed on Tuesday to explore business cooperations in the oil and gas sector.

In the memorandum of understanding (MoU) signed in Jakarta, the two companies agreed to conduct studies as well as to look for business partnerships.

Pertamina president director Karen Agustiawan said the company intended to offer its research centers as well as seismic interpretation abilities. While NPCP chairman Frank Kramer said his company wanted to form a long-term relationship with the Indonesian government through Pertamina.

“We think there’s a lot of relevance beaconing, with [Pertamina’s] more than 50 years in LNG,” he said.

Kramer said that NPCP might also help Pertamina develop Liquid Natural Gas (LNG) sources in geologically challenged areas.

NPCP would be open to sharing seismic data with Pertamina in the future when the opportunity arises, added Kramer.

NPCP is currently constructing a US$ 20 billion LNG project with Exxonmobil, according to Kramer. “As of right now, it is 85-90 percent complete. But there will be a third train, a fourth train, and a fifth train,” Kramer said.

PNG Prime Minister Peter O’neill expects his country’s GDP to double by 2015 due to development of LNG, where 2011 figures show PNG GDP at $12.93 billion.  (asw)

Tangguh’s second train shut down after fire | The Jakarta Post

Tangguh’s second train shut down after fire | The Jakarta Post

London-based oil and giant BP Plc has temporarily suspended operations of its second liquefied natural gas (LNG) train at the Tangguh plant in Teluk Bintuni, West Papua, after a fire.

The fire struck Train 2, which produces 3.8 metric tons per annum (MTPA) of LNG, at 11:30 am local time on Tuesday, BP Asia-Pacific regional president William Lin said in an email statement sent to The Jakarta Post.

“Train 2 was immediately shut down and within one hour the fire was extinguished,” Lin said in the email. There were no injuries reported.

“Investigation is ongoing to determine cause of the fire. Train 1 was not impacted by the incident,” Lin said.

The executive did not comment on estimated losses or the firm’s strategy to make up the gas shortage resulting from the idling of Train 2 as the inquiry proceeds.

Tangguh is a massive gas project in Papua that has estimated total proven gas reserves amounting to 4.4 trillion cubic feet.

The plant comprises two production units, which a combined annual output of 7.6 million tons of LNG.

Train 1 started operation in February 2009, which was followed by Train 2 in July 2009.

All of the LNG currently produced by the plant is exported to China, South Korea, Taiwan and Japan.

The government approved in principal BP’s proposal to build a third LNG train at the plant for US$12 billion during President Susilo Bambang Yudhoyono’s bilateral meeting with UK Prime Minister David Cameron in London last week.

The new train, expected to begin operation by 2018, will have an estimated production capacity of 3.8 MTPA when complete, bringing total gas production at Tangguh to 11.4 MTPA.

BP and its partners in the Tangguh plant have agreed as stipulated in the firm’s expansion plan to sell 40 percent of the LNG output from the third train to state electricity firm PT PLN for the domestic market.

Upstream oil and gas regulator BPMigas spokesman Hadi Prasetyo said separately that the regulator hoped that BP’s plan to expand operations at Tangguh would not be delayed by the fire.

“As for the gas production shortage due to the shutdown of the Train 2, they [BP] have informed us that it can still be covered by the gas reserves provided by Train 1,” Hadi told the Post in a telephone interview.

He added that BPMigas was still waiting for BP to complete their investigation over the fire, including its cause.