Bloomberg quoted an official at the nation energy regulator, BPMigas said Indonesia will begin talks with China National Offshore Oil Corp. this year on new liquefied natural gas prices from the Tangguh plant in Papua.

BPMigas spokesman Mr Gde Pradnyana said “We will start price negotiations this year which will be applied in 2013. We are seeking the best price.”

Indonesia, the world second largest exporter of LNG after Qatar is seeking higher sales after 2011 Asian spot prices increased the most since 2008. The cost of gas for prompt supply this year may climb to as much as USD 25 per million British thermal units from USD 15 as global demand surges.

According to Mr Pradnyana who declined to give details on the price increase that Indonesia is seeking in the negotiations the talks are parts of a review carried out every four years under the supply contract.

The Tangguh project has a 25-year contract to supply 2.6 million tonnes a year to China.

(Sourced from Bloomberg)