The Asian Development Bank has agreed to provide a US$400 million loan to support the expansion of Indonesia’s Tangguh LNG production facility.
“Expanding the Tangguh LNG facility is crucial for Indonesia to meet its increasing energy demand,” said Christopher Thieme , deputy director general for ADB private sector operations.
“The project will also support the country’s goal of developing a more sustainable energy mix in a continuous effort to achieve energy security while reducing carbon emissions,” Thieme said.
Operational since 2009, the Tangguh facility in eastern Indonesia’s Papua Barat province supplies around 7.6 million metric tons per annum of LNG, one of the largest productions in the country. BP operates the facility through its unit BP Berau.
The Tangguh expansion project will add a third LNG train that will increase capacity by an additional 3.8 mtpa, along with associated onshore and offshore production facilities and supporting infrastructure. Train 3 is expected to start production in 2020.
The two existing trains were financed by ADB, the Japan Bank for International Cooperation, and international commercial banks in 2006-2007, ADB said in its statement.
The national power utility PT. PLN (Persero) booked 75 percent of the new LNG production to fuel its existing and planned gas fired power plants. The remaining volumes have been contracted by Kansai Electric Power of Japan.
The final investment decision to build a third train at the facility has been reached in July, this year.
Other partners in the Tangguh production sharing contract are MI Berau (16.30%), CNOOC Muturi (13.90%), Nippon Oil Exploration (Berau) (12.23%), KG Berau Petroleum and KG Wiriagar Petroleum Ltd (10.00%), Indonesia Natural Gas Resources Muturi (7.35%), and Talisman Wiriagar Overseas (3.06%).