Indonesia Advisory

San Diego-based Sempra Energy will buy 3.7 million tons of liquefied natural gas (LNG) worth $1.1 billion annually from Tangguh project in Papua, Bisnis Indonesia reported.

Sempra will import LNG for supply to the US and Mexican market, Energy and Mineral Resources Minister Purnomo Yusgiantoro said in Mexico over the weekend.

The first shipment will be made in the second half of 2009 to Costa Azul in California, Yusgiantoro said after accompanying President Susilo Bambang Yudhoyono in a meeting with Sempra management in Mexico.

Last week, state oil and gas regulator BP Migas deputy chief Djoko Harsono said the Tangguh LNG project will be delayed until the second quarter of next year.

"It will come on stream in the second quarter of next year," Harsono told reporters on the sidelines of a gas conference, without giving a reason for the delay.

In Mexico, President Yudhoyono also met with a consortium of local companies proposing to take part in the construction of LNG receiving terminals in Banten and Gresik in Java.
A consortium of state companies - Pertamina, Perusahaan Gas Negara and PLN plan to build the LNG terminals to facilitate gas distribution in Java.