Thailand looks to Tangguh for gas imports

Bangkok: PTT, Thailand's top oil and gas firm, is in talks to import liquefied natural gas (LNG) from Indonesia's Tangguh project, a PTT official said on Friday, another move to secure the country's rising energy needs.
If a deal comes through, PTT, which does not now import LNG, would ship in 1 million tonnes of the gas each year from 2011 or 2012, Chitrapongse Kwangsukstith told Reuters. He declined to give a timeframe for the duration of the contract.
"We're still working on the details but we should be able to finalise whether to buy it soon," Chitrapongse, chief operating officer of PTT's upstream and gas operations, said.
The LNG will be sourced from volumes contracted to Sempra LNG in Mexico, a source close to the talks said, possibly the first time Sempra Energy diverts LNG cargoes away from the American market.
Indonesia hopes the $5 billion Tangguh LNG project -- due to produce 7.6 million tonnes of LNG a year from October 2008 -- will help it offset dwindling domestic supply from its other LNG complexes.
Oil giant BP operates Tangguh and has a production-sharing contract with oil and gas regulator BPMIGAS.
Thai energy needs are surging. Domestic gas demand rose by about 10 percent to roughly 3.4 billion cubic feet per day in 2007 and is projected to grow at the same pace to 2012 as power plants and chemical firms switch from imported oil to gas-driven plants and as more cars use natural gas.
Natural gas accounts for two thirds of the fuel used to generate electricity in Thailand.
PTT already signed a 10-year contract with Qatargas to import 1 million tonnes per year (tpy) of LNG starting in 2011 and has said earlier it aimed to sign deals soon with two more suppliers.
In 2006, PTT signed a preliminary agreement with Iran's Pars LNG Ltd to buy 3 million tonnes of LNG a year for 20 years, but the deal has been delayed over disagreements on pricing.
PTT is also in talks with other LNG suppliers, such as from South Africa, the Middle East, Indonesia and Australia.
PTT is also building a $700 million LNG receiving terminal at Map Tha Put in the eastern Thai province of Rayong, which is expected to come into operation in 2011. [02/05/08]

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