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By Muklis Ali

JAKARTA, July 3 (Reuters) - The first delivery of liquefied natural gas (LNG) from the BP-led Tangguh project in Indonesia's Papua is set to depart soon for South Korea, the director general of oil and gas said on Friday.
Earlier, Energy Minister Purnomo Yusgiantoro told reporters the $5 billion project was ready and a cargo had already left, but this was later clarified.
"The cargo has not left yet because they are filling the LNG tanker slowly," Evita Legowo, director general of oil and gas at the energy minister, told reporters. She said the cargo could depart on Saturday night and was going to South Korea's POSCO .
The energy minister, who visited Tangguh last week, had said earlier that the cargo going to South Korea was switched from Fujian in China because a receiving terminal was not ready there.
Indonesia, the world's third-biggest LNG exporter, has been counting on Tangguh to help make up for declining production at other projects.
The plant in the remote Papua province in eastern Indonesia is due to be the country's third LNG centre with a capacity to produce 7.6 million tonnes per year (tpy) via two trains.
The project, which had been delayed several times due to technical problems, including a damaged valve, comes on stream as falling global demand has caused a glut of LNG supply and tumbling prices.
Asian LNG prices peaked above $22 per British thermal unit (mmBtu) last summer, but have since sagged to below $5.
Tangguh has several foreign supply contracts, including a 2.6 million tpy contract with China National Offshore Oil Corp (CNOOC).
The deal struck with China has become a sensitive issue ahead of Indonesia's presidential election on July 8, with some politicians slamming the gas price agreed under the previous government of former president Megawati Sukarnoputri as too low.
There have also been some calls ahead of the election for Indonesia to allocate more gas to the domestic market rather than for exports.
U.S. firm Sempra Energy also has a 20-year contract to lift 3.6 million tpy with the right to divert half to customers other than its own terminal in Mexico.
The project also has a supply contract with South Korea's K-Power.

(Writing by Ed Davies; Editing by Ben Tan)

((ed.davies@thomsonreuters.com; Reuters Messaging; ed.davies.reuters.com@reuters.net; tel +6221 384 6364)) Keywords: INDONESIA TANGGUH/ (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)

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JAKARTA, July 3 (Reuters) - The first delivery of liquefied natural gas (LNG) from the BP-led Tangguh project in Indonesia's Papua has started, Energy Minister Purnomo Yusgiantoro said on Friday.
One LNG cargo from the $5 billion project was being delivered to South Korea, the minister said, after it was switched from Fujian in China because a terminal was not ready there.
"I have been there (to Tangguh) last week and everything is okay. The first cargo has already gone to South Korea," Yusgiantoro told reporters. He did not specify what South Korean firm would receive the cargo.
The project has supply contracts with South Korean firms K-Power and POSCO.
Indonesia, the world's third-biggest LNG exporter, has been counting on Tangguh to help make up for declining production at other projects.
The plant in the remote Papua province in Eastern Indonesia is due to be the country's third LNG centre with a capacity to produce 7.6 million tonnes per year (tpy) via two trains.
The project, which had been put back several times due to technical problems, including a damaged valve, comes on stream as falling global demand has caused a glut of LNG supply and tumbling prices.
Asian LNG prices peaked above $22 per British thermal unit (mmBtu) last summer, but have since sagged to below $5.
Tangguh has several foreign supply contracts, including a 2.6 million tpy contract with China National Offshore Oil Corp (CNOOC).
The deal struck with China has become a sensitive issue ahead of Indonesia's presidential election on July 8, with some politicians slamming the gas price agreed under the previous government of former president Megawati Sukarnoputri as too low.
There has also been some calls ahead of the election for Indonesia to allocate more gas to the domestic market rather than for exports.
U.S. firm Sempra Energy also has a 20-year contract to lift 3.6 million tpy with the right to divert half to customers other than its own terminal in Mexico.
(Reporting by Muklis Ali; Writing by Ed Davies)

((ed.davies@thomsonreuters.com; Reuters Messaging; ed.davies.reuters.com@reuters.net; tel +6221 384 6364)) Keywords: INDONESIA TANGGUH/ (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)

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Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

JAKARTA, July 3 (Reuters) - The first delivery of liquefied natural gas (LNG) from the BP-led Tangguh project in Indonesia's Papua has started, Energy Minister Purnomo Yusgiantoro said on Friday.
One LNG cargo from the $5 billion project was being delivered to South Korea, the minister said.
Indonesia, the world's third-biggest LNG exporter, has been counting on Tangguh to help make up for declining production at older projects.
(Reporting by Mukli Ali; Writing by Ed Davies)

((ed.davies@thomsonreuters.com; Reuters Messaging; ed.davies.reuters.com@reuters.net; tel +6221 384 6364)) Keywords: INDONESIA TANGGUH/ (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)

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Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.

By Missy Ryan

BAGHDAD, July 2 (Reuters) - Iraq plans to bring forward a second bidding round for major energy contracts and may give foreign firms another run at oilfields that were left over after this week's sale, which clinched only one deal.
The country's second bidding round of energy deals "was supposed to be at the end of the year but we have moved it up. We will announce the new date. It could be in the next few months," oil ministry spokesman Asim Jihad said on Thursday.
That auction will follow on from Tuesday's tender for eight major oil and gas fields, Iraq's first energy sale since the 2003 U.S. invasion and the first open run oil firms have had at the world's third largest reserves since Iraq nationalised the industry in 1972.
The auction awarded just one field, to a foreign group led by BP, a disappointment to those who had hoped the round would help Iraq quickly revive a struggling oil sector and boost production of about 2.4 million barrels per day.
The government in Baghdad nevertheless deemed the exercise as a success because the Rumaila field awarded to the BP-led group, which also included the China National Petroleum Corp. (CNPC), is a very large one.
The auction revealed a deep gulf between what the Iraqi government was willing to pay for developing the fields, most of which are already in production, and the fees foreign firms expected to earn.
Iraq desperately needs money to rebuild after six years of conflict and is widely viewed as unable to fix an oil sector damaged by decades of war, sanctions and neglect without the capital and expertise of international energy firms.
Jihad said the unawarded oilfields might be offered in another bidding process, or could be added to the second round or in some cases might even be developed by a future National Oil Company, if the company is revived when the country passes the necessary legislation.
The second round is seen as even more lucrative than the first because the fields on offer have not yet been developed.
Deputy Prime Minister Barham Salih, speaking from the Kurdish city of Sulaimaniya, called the BP deal to develop the 17-billion-barrel Rumaila field, Iraq's biggest, "an important step forward and a signal."
"We need to pursue a policy of maximising production in the shortest time," he told Reuters. "There are certain areas in which we find companies reluctant to come ... We may have to rely on our own resources and policies."

NEW NATIONAL OIL COMPANY?
Jihad said that the government planned to develop two major gas fields, Akkas and Mansuriyah, on its own after neither was awarded to a foreign bidder in Tuesday's auction.
"Akkas and Mansuriyah will be developed by the National Oil Company after approval of the new oil law," Jihad said.
A group led by Italy's Edison was the sole bidder for Akkas, a 2.1-trillion cubic feet field in Iraq's vast western desert, but its proposed fee of $38 for each additional barrel of oil equivalent produced was far above the $8.50 a barrel Iraq suggested.
No agreement on Akkas or other unawarded fields was reached when the Iraqi cabinet reviewed the companies' bids, some of them revised, the day after the tender. All were rejected.
The creation of a new National Oil Co will depend on parliament passing long-delayed hydrocarbon legislation. The laws have been held up for years by feuding between the central government in Baghdad and minority Kurds in northern Iraq.
There are few signs the impasse will be broken soon.

(Additional reporting by Sherko Raouf in Sulaimaniya; Editing by Michael Christie and Anthony Barker) Keywords: IRAQ/OIL CONTRACTS (missy.ryan@thomsonreuters.com; +964 7901 917024; Reuters Messaging: missy.ryan.reuters.com@reuters.com)

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Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.