Indonesian LNG to USA

Indonesia's executive agency for Oil and Gas has signed a Heads of Agreement with Sempra Energy LNG Corp. for a 20-year supply of liquid natural gas (LNG) from Indonesia to markets in the US and Mexico.

Under the agreement, 3.7 million tons of LNG per annum will be delivered from the Tangguh fields in Indonesia over a period of 15 years beginning in 2007 to Sempra's proposed LNG import and re-gasification terminal near Ensenada in Baja California, Mexico. The agreement also provides for an additional five years of LNG supply to Sempra's terminal from other Indonesian LNG sources.

The terminal, when completed, will have the capacity to process up to 1 billion cubic feet per day of natural gas. Sempra will market the gas to customers in the US west coast and Mexico. The agreement will be highly flexible in nature allowing for LNG cargoes to be diverted to other core markets in Asia while providing core volumes and revenues to the terminal.

Ralph Alexander, chief executive of BP's Gas, Power & Renewables division said, "By working closely with Sempra and the Indonesian government we have created a highly flexible LNG supply deal to serve North American and other regional markets. This flexibility reflects how the supply of LNG is changing and it means that Tangguh will be able to offer LNG to prospective new customers in Japan, Korea and China."