CNOOC's Fujian terminal receives first Tangguh LNG cargo

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, July 27 -- China National Offshore Oil Corp.’s (CNOOC) Fujian terminal has received its first LNG cargo from Indonesia’s BP PLC-led Tangguh LNG project.

The first shipment of LNG from Tangguh will be supplied to gas-fired electric power plants in Putian, Jinjinag, and Xiamen in the province, as well as to residents in the cities of Fuzhou, Putian, Quanzhou, Xiamen, and Zhangzhou.

Under a 25-year contract, CNOOC will see another 14 shipments of LNG from Tangguh this year for a total supply of 2.6 million tonnes, and will receive the same amount for the duration of the agreement.

Indonesia began supplying LNG to Fujian from May, but the gas had to be sourced from the country's Bontang LNG plant due to repeated delays at Tangguh (OGJ Online, May 29, 2009).

Last week, Indonesia’s upstream oil and gas regulating agency BPMigas said it expects Tangguh gas field to ship 56 cargoes of LNG to buyers in 2009.

Head of BPMigas Raden Priyono said of the 56 cargoes, 17 would be shipped to Fujian in China, 8 to Posco in South Korea, 12 to K-Power in South Korea, and 19 cargoes to Sempra Energy Marketing Co. in the US.
"We have the target to ship all of the 56 cargoes this year," said Priyono, who acknowledged that earlier a “small technical problem” at Tangguh caused a slowing down of its production processes.

Priyono said Tangguh sales have reached 7.4 million tpy, including 3.7 million tonnes for Sempra Energy, 2.6 million tonnes for Fujian, and 1.1 million tonnes for Posco and K-Power.

Also last week, Indonesia's PT Badak NGL, operator of the Bontang LNG plant, said it would ship more LNG to Fujian on July 24, making it the third shipment from Bontang to Fujian on order from CNOOC.

Badak NGL Pres. Agus Haryanto said in May and June, his company shipped two cargos while the Arun LNG plant in Aceh also shipped two cargoes of LNG to Fujian.

According to Indonesian state media, the four cargoes were made under a swap arrangement for LNG shipments committed to by Tangguh LNG but which could not be delivered as planned.

Meanwhile, Chinese media reported that CNOOC plans to double the annual receiving capacity of its Fujian LNG terminal to 5.2 million tonnes by 2011. The reports said construction of two new storage tanks at the terminal began at the end of 2008.

Contact Eric Watkins at hippalus@yahoo.com.

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