Management and operation of Indonesian liquefied natural gas (LNG) Projects

Indonesia is one of the world's largest exporter of liquefied natural gas (LNG) and the Indonesia Project Unit is currently involved in two major LNG projects there: the Tangguh LNG Project, which is a large-scale investment project, and the Arun II LNG Project, through which we import one million tons of LNG per year.

Construction on the Tangguh LNG Project as Indonesia's third base of LNG production got underway following the final investment decision in March 2005. Production at Tangguh is now scheduled to begin at the end of 2008. Located in the Bintuni area in western Papua, Tangguh is expected to provide 7.6 million tons of LNG per year. It will play an important role in securing stable supplies of LNG to China, South Korea and the United States, as well as other countries in the Asia-Pacific region. In collaboration with INPEX Corporation, Mitsubishi Corporation (MC) acquired a 16.3 percent of upstream rights in the project in July 2001 and increased its rights by 1.4% in October 2007. MC is playing a leading role in the implementation of the project together with BP, the operator of the Tangguh project.

The Arun II LNG Project started supplying LNG in 1984. In 1981, Tohoku Electric Power Co., Inc., and Tokyo Electric Power Co., Inc., signed a sales and purchasing contract with PERTAMINA to buy LNG produced from the Arun gas field in Sumatra, Indonesia. The LNG produced at the Arun LNG plant is supplied on an FOB basis, and approximately one million tons are delivered to the Niigata terminal for delivery to Tohoku Electric Power and to the Futtsu and Higashi-Ohgishima terminals for Tokyo Electric Power. MC is in charge of LNG import operations for this project.