Indonesia Wants Market Price for Tangguh LNG from CNOOC

Indonesia is determined to get a market price for liquefied natural gas exported from the BP-operated Tangguh LNG project in Bintuni Bay of Papua Barat to CNOOC of China.

CNOOC currently pays $3.50/MMBtu for Tangguh LNG.

“The new price cannot be below the market price. It has to be aligned with the market price,” Platts cited Widyawan Prawiraatmaja, SKK Migas’ deputy chief for commercial control as saying.

He also added that assuming the Japan Crude Cocktail price is $100/barrel, the LNG price should be around $14/MMBtu.

BP received an approval from Indonesia in December to build a third LNG train, as part of Tangguh plant expansion. The new train will have 3.8 million metric tons production capacity per year.

The LNG processing plant currently consists of two LNG trains, producing at least 7.6 million metric tons of LNG a year.

[mappress]
LNG World News Staff, July 8, 2013; Image: BP