Indonesia holds 63 uncommitted LNG cargoes for 2017 delivery (updated)

Narasaki Sangyo

20/10/2016 11:04

(Adds context, quotes) 
    By Wilda Asmarini 
    JAKARTA, Oct 20 (Reuters) - There are currently 63 
uncommitted cargoes of liquefied natural gas (LNG) for 2017 
delivery from Indonesia's Tangguh and Bontang projects, 
Wiratmaja Puja, the country's Director General of Oil and Gas, 
said on Thursday. 
    "We are still oversupplied," Puja said, noting that the 
government was looking for committed buyers and that deals for 
13 of the cargoes were currently being negotiated. 
    "It would be real pity if we had to cut production."  
    The 63 cargoes is the equivalent of about 6.99 million 
tonnes of LNG, based on Reuters calculations. A standard sized 
LNG cargo contains about 150 to 170 million cubic metres of 
natural gas or about 111,000 to 125,800 tonnes of LNG. 
    Last year, Indonesia exported just over 17 million tonnes of 
LNG.  urn:newsml:reuters.com:*:nJ9N14Y00P 
    Puja added that for 2018 there were still "more than 60" 
uncommitted cargoes. 
    Indonesia gets priority on a large portion of domestically 
produced LNG, but development of infrastructure to absorb the 
fuel has been slower than hoped both locally and abroad, putting 
pressure on gas prices.  urn:newsml:reuters.com:*:nL8N1930AO 
    "We have prepared everything that has been requested for 
electricity, but we are still developing the infrastructure," 
Puja said, meaning that LNG supply has been allocated. 
    Despite the inability to use the gas domestically and 
falling demand abroad, Indonesia has approved an expansion of 
the Tangguh LNG project in the country's West Papua province 
that will boost annual LNG production capacity by 50 percent. 
 urn:newsml:reuters.com:*:nL4N19N2OV 
    Indonesia is looking to expand small-scale LNG 
regasification capacity in central and eastern Indonesia in 
order to meet soaring energy demand in the region and to soak up 
LNG supply.  urn:newsml:reuters.com:*:nL3N1BY17K 
    The country has ramped up gas consumption targets for 
environmental reasons, and plans to subsidise natural gas for 
industrial buyers.  urn:newsml:reuters.com:*:nL3N18F3L8 urn:newsml:reuters.com:*:nL4N19D1YD 
    The LNG demand target from Indonesian state power utility 
Perusahaan Listrik Negara (PLN), however, was unchanged this 
year, amid slower growth in electricity use and declining 
industrial power demand.  urn:newsml:reuters.com:*:nJ9N11E01N 
    Indonesia is the world's 11th largest gas producer, 
according to the Indonesian Gas Society, and ships LNG from 
Bontang and Tangguh to Japan, South Korea and China, as well as 
to domestic buyers. 
    Badak NGL, which operates the Bontang LNG plant, is a unit 
of state energy company Pertamina, while the Tangguh project is 
majority owned by BP  BP.L . 
    Asian liquefied natural gas (LNG) gas prices hit a 
nine-month high of $6.55 per million British thermal units this 
month. That's still 51 percent below the price two years ago.    
 
 (Writing by Fergus Jensen; Editing by Joseph Radford and 
Christian Schmollinger) 
 ((fergus.jensen@thomsonreuters.com; +62 21 2992 7604; Reuters 
Messaging: fergus.jensen.thomsonreuters.com@reuters.net)) 
 
Keywords: INDONESIA LNG/