Indonesia said it has raised the price of its Tangguh liquefied natural gas for China’s CNOOC.
$3.3 mmbtu agreed in the previous contract was more than doubled to $8 mmbtu for the rest of the year and the price will continue to rise annually, according to the new contract.
Minister of Energy Jero Wacik said that: “Tangguh gas price, which was tied to oil prices, rose significantly since the terms were agreed and it has not been amended.”
Minister further went on to say that the prices of oil were fairly low, at $38 a barrel which is the reason the Tangguh gas prices remained low and the correction in pricing vas long overdue.
These are also good news for the government to follow as the gas revenue will significantly increase.
Tangguh, which consists of two LNG trains each with a capacity of 3.8 mtpa, is operated by BP Indonesia and the company holds a 37.16% interest in the LNG project.
Other Tangguh contract partners are MI Berau (16.30%), CNOOC (13.90%), Nippon Oil Exploration (12.23%), KG Berau/KG Wiriagar (10.00%), LNG Japan Corporation (7.35%), and Talisman (3.06%).
[mappress] LNG World News Staff, July 1, 2014; Image: BP