Oil giant BP has reportedly signed loan agreements worth $884 million with banks in order to help finance the Tangguh liquefied natural gas project in Papua, Indonesia, upstreamonline.com has revealed.
The industry publication said that, according to Indonesia’s energy watchdog, BPMigas, the banks include Bank of China and Bank of Tokyo-Mitsubishi.
The project is expected to become operational in late 2008. BP signed agreements with several international banks in August 2006 for $2.6 billon in loans. The project is valued at $5 billion, upstreamonline said.
According to the publication, the Tangguh project is due to produce 7.6 million tonnes of liquid natural gas (LNG) a year. The project has secured contracts to supply to China, the US west coast and South Korea. It will take gas from three blocks that BP operates in the area, which have combined reserves of 14.4 trillion cubic feet.