If the natural gas to be liquefied has been purchased by a private party, then the LNG and related processing and other facilities will be owned by the purchaser. Currently, Indonesia has three main LNG export facilities: the Arun, Bontang and Tangguh facilities.
If conducted within the framework of a cooperation contract, the chief approval required will be the approval of the development plan by the government (through the Minister). If conducted outside the framework of a cooperation contract, the processing entity will need one or more downstream business licenses, depending on the scope of its operation.
To establish and operate private LNG facilities, the approval of Indonesia’s Capital Investment Coordinating Board (BKPM) is required if the project is to be undertaken by a processing company with foreign ownership. In addition to these approvals, other technical, safety and environmental licenses are required to be obtained from the Ministry of Energy and Mineral Resources, the other departments having jurisdiction over major construction projects, as well as from the relevant regional and provincial governments. Depending on the structure of the project, financing could also be subject to government approval.
There are no regulations concerning the determination of the prices and terms of service in the LNG sector. The price of LNG will vary depending on the contractual arrangements between the sellers and buyers. If the LNG is sold within the framework of a cooperation contract, its sale and pricing will be subject to the provisions of the cooperation contract and the government regulations applicable to the sale of natural gas.
There is no specific regime or regulations on third-party access to LNG facilities.
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