BP May Divert Sempra LNG From Tangguh to Gas Negara’s Terminal in Sumatra

BP Plc (BP/) may divert liquefied natural gas from its Tangguh plant in Indonesia meant for Sempra Energy (SRE)’s port in the U.S. to PT Perusahaan Gas Negara’s planned terminal in North Sumatra, a government official said.

As much as 140 million cubic feet a day may be diverted, Evita Legowo, director general of oil and gas at the Energy and Mineral Resources Ministry, told reporters in Jakarta today.

BP and Gas Negara are currently in talks on the price of the LNG and expect to reach an agreement this year, Legowo said. Gas Negara will use the fuel to supply PT Perusahaan Listrik Negara’s power plant in North Sumatra, she said.

Indonesia, Southeast Asia’s largest economy and the world’s third-biggest LNG exporter, is trying to boost domestic use of the cleaner-burning fuel to make up for declining oil production. Aging fields led to the country’s withdrawal from the Organization of Petroleum Exporting Countries in 2008.

Gas Negara, based in Jakarta, allocated $250 million to build the Belawan LNG receiving terminal, Riza Pahlevi Tabrani, finance director at Indonesia’s largest distributor of the fuel, said in September.

LNG is natural gas chilled to liquid form for transportation by ships to places not connected by pipelines. Qatar and Malaysia are the world’s largest and second-biggest exporters of the fuel, respectively.

To contact the reporters on this story: Bambang Djanuarto in Jakarta at bdjanuarto@bloomberg.net; Yoga Rusmana in Jakarta at yrusmana@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net.