Tangguh LNG, operated by client BP, is situated on the south side of Bintuni Bay in Papua Barat Province, Indonesia. The facility extracts natural gas from large offshore reservoirs and pipes it to an onshore LNG plant for conversion to LNG. It is then exported by tanker to markets in Asia Pacific and beyond. The facility is anticipated to have an operational lifespan of more than 20 years with the potential for expansion depending on reservoir performance and proving of additional reserves.
The project has been operational since 2009. The consortium of lenders, including Asian Development Bank (ADB), required an external panel to undertake annual reviews to ensure ongoing compliance with the environmental impact assessment, Land Acquisition and Resettlement Action Plan (LARAP), indigenous Peoples Development Framework and best practice. The overall objectives were to assess the compliance of operational activities with national regulations and lender requirements.
Challenges and solutions
In addition to being in one of the most remote places in the world, the project presented other challenges. While we found the project to be performing well in terms of environmental and social management, there were issues related to closing out the LARAP, engaging with external stakeholders and indigenous leaders, addressing grievances and monitoring environmental exceedances.
On our first visit we closed out the 10 year process of implementing the LARAP. Our review recommended that the resettled affected villages should no longer be identified as such. Rather, they should be considered as equivalent to other local villages, and no longer differentiated. This minimised dependency on BP.
We recommended improvements to the grievance management procedures, by logging and responding to all complaints and comments within specified timescales.
Value and benefits
Our team included environmental and social specialists experienced in working in the LNG and oil and gas sector in Indonesia and in West Papua, and West Papuan indigenous peoples specialists who truly understand the local context and language.
We used participatory rural appraisal tools to evaluate the effectiveness of BP’s social programmes and community perceptions.
We also involved local staff permanently based in our Singapore office to reduce costs for the client.