BP announces final investment decision approval for Tangguh project in Indonesia

BP has announced its approval of the final investment decision (FID) for the development of the Tangguh expansion project in Indonesia’s Papua Barat Province.

The FID decision follows the Government of Indonesia’s approval of the plan of development II in 2012.

The project is set to add a third LNG process train (Train 3) and 3.8 million tonnes per year (mtpa) of production capacity to the existing facility will bring the total plant capacity to 11.4mtpa.

It also has two offshore platforms, 13 new production wells, an expanded LNG loading facility, and supporting infrastructure, while also supporting the country’s growing energy demand.

About 75% of the LNG production per year from Train 3 is planned to be sold to the Indonesian state electricity company PT. PLN (Persero).

BP Group chief executive Bob Dudley said: “The Tangguh expansion project demonstrates BP and its partners’ continued confidence in Indonesia and our commitment to work closely with the government to meet the country’s energy needs, while creating thousands of jobs.”

The company said that the Tangguh project will provide 10,000 jobs during the project period.

BP Asia Pacific regional president Christina Verchere said: “This final investment decision marks the culmination of many years of hard work by BP, our partners, and the Indonesian Government.

“We are pleased to reach this major milestone and look forward to continued cooperation as we progress the largest upstream project in the eastern part of Indonesia.”

The company expects engineering, procurement and construction (EPC) contracts for the project in the third quarter of this year with construction to begin thereafter.

Tangguh is set to become operational in 2020.

The Tangguh LNG facility is operated by BP Berau on behalf of the other production sharing contract partners as contractor to SKK Migas.

BP and its affiliates in Indonesia hold a 37.16% interest in the project. Other partners are MI Berau (16.30%), CNOOC Muturi (13.90%), Nippon Oil Exploration (12.23%), KG Berau Petroleum and KG Wiriagar Petroleum (10%), Indonesia Natural Gas Resources (7.35%), and Talisman Wiriagar Overseas (3.06%).