MW BP approves expansion of West Papua LNG project at meeting with Indonesia's new president
By Louis Goss
BP $(BP)$( UK:BP) has approved plans to significantly expand its Tangguh LNG facility in Indonesia, with a view to using natural gas from the nearby Ubadari field as feedstock for the liquified natural gas plant that delivers fuel to customers in Asia and the U.S.
The British oil major on Thursday said it had signed off on the $7 billion plans that are expected to unlock up to 3 trillion cubic feet of extra natural gas resources for the Tangguh LNG facility in West Papua, Indonesia's westernmost province.
The Tangguh LNG facility currently has the capacity to produce 11.4 million tons of LNG per annum following a major expansion of the plant last year that saw the addition of a third production unit.
The Indonesian plant, which first started production in 2009, is currently owned and operated by BP, which owns a 40.22% stake in the project alongside partners including China National Offshore Oil Company (CNOOC) and Japan's Mitsui.
BP said the plans will also see it work on developing Indonesia's carbon capture, utilization and storage facility to use carbon emissions from the LNG plant to enhance recovery of natural gas by pumping those emissions into the wells.
The British firm signed off on the plans during a meeting with Indonesia's newly elected president, Prabowo Subianto, in London on Thursday. The Indonesian president's trip also saw him meet the U.K.'s prime minister Keir Starmer and King Charles III.
Probowo, a retired army general once banned from the U.S. over alleged human rights abuses, took office in October this year following a victory in nationwide elections in February.
The former special forces commander was reportedly discharged from the Indonesian military over allegations he directed the torture of student activists in the 1990s, according to a profile of the new president by Amnesty International. Prabowo has also been accused of leading death squads in East Timor.
The Tangguh LNG facility sits on the western coast of West Papua, a territory on the island of New Guinea that has been engulfed in conflict for decades between Papuan separatists and the Indonesian government, which has faced repeated allegations of abuses against local people.
The final investment decision comes after BP's new chief executive, Murray Auchincloss, said he would focus on generating shareholder returns over any push to cut oil and gas production in line with plans outlined by predecessor, Bernard Looney, to cut firmwide production to 2 million barrels per day by 2030.
-Louis Goss
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(END) Dow Jones Newswires
November 22, 2024 09:34 ET (14:34 GMT)
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