(EnergyAsia, October 27 2014, Monday) — Indonesia is preparing to meet an increase in domestic natural gas consumption through new supply contracts and BP’s award of a major contract for the US$12 billion expansion of the Tangguh liquefied natural gas (LNG) project in West Papua province.

In the country’s largest domestic LNG deal, energy regulator SKKMigas said state utility PLN has agreed to purchase an annual 1.5 million tons of the fuel from the BP-operated Tangguh project from 2015 to 2033.

Several Indonesian firms also signed separate agreements to purchase piped gas from Malaysia’s state energy firm Petronas, and subsidiaries of Indonesia’s state energy firm Pertamina and privately owned Medco Energi. SKKMigas did not disclose details about the agreements.

To meet its supply obligations, Pertamina said it recently concluded long-term agreements to import LNG from Africa and the US. Mozambique will be the main source of LNG from Africa, starting with annual shipments of 1.5 million tonnes and rising to 3 million tonnes from 2020.

Pertamina is already contracted to import an annual total of 1.52 million tonnes of the fuel from Cheniere Energy Inc in the US starting as early as 2018.

Separately, UK major BP said it has awarded contracts to two consortia to work on the onshore front-end engineering and design (FEED) for the US$12 billion addition of a third train to the Tangguh LNG project.

Japan’s Chiyoda Corp is a member of the first consortium comprising PT Tripatra Engineers and Constructors, PT Tripatra Engineering, PT Chiyoda International Indonesia, PT Saipem Indonesia, PT Suluh Ardhi Engineering.

Japan’s JGC Corp is a partner in the second consortium comprising PT Rekayasa Industri, PT KBR Indonesia and PT JGC Indonesia.

The two consortia will work on the 12-month FEED contract for the 3.8-million tonne/year train in West Papua’s Teluk Bintuni regency. The plant will add to the complex’s existing two trains of the same size. BP said 40% of Train 3’s annual production will be reserved for the domestic market.

“The awarding of the onshore FEED contracts and signing of the sales and purchase agreement with PLN are major accomplishments, which demonstrate progress for the Tangguh Expansion Project. The Train 3 project will deliver significant value, including much needed energy to Indonesia,” said Bob Dudley, BP’s group chief executive.

Tangguh is operated by BP Berau Ltd on behalf of the other production sharing contract parties, as contractor to SKK Migas.

BP Berau Ltd and its affiliates in Indonesia hold a 37.16% interest in the project. Its partners include MI Berau BV (16.3%), CNOOC Muturi Ltd (13.9%), Nippon Oil Exploration (Berau) Ltd (12.23%), KG Berau Petroleum Ltd and KG Wiriagar Petroleum Ltd (10.00%), Indonesia Natural Gas Resources Muturi Inc (7.35%), and Talisman Wiriagar Overseas Ltd (3.06%).