South East Asia market snapshot - June 2016

Report summary

This month, we saw bright spots in the Southeast Asian LNG market and the release of latest power development plans (PDPs). Bright spots in Southeast Asian LNG: In Indonesia, PLN increased its contracted quantity for BP Tangguh's Train 3 from 1.5 mmtpa to 2.8 mmtpa, allowing further development. Within the same month, BP announced a reduction in its investment budget for the project from US$12 billion to US$8-10 billion, reflecting lower EPC costs. In Malaysia, JX Nippon bought a 10% stake in PETRONAS' 3.6 mmtpa MLNG Train 9 for a reported price of US$575 million. More PDPs released: PLN released its latest annual business plan which outlines Indonesia's power development for the next 10 years. The key highlight of the latest document is the reduced portion of coal generation in 2025, which is 32% lower compared with the previous RUPTL. In Vietnam, a regional PDP was released. Its targets include the installation of more than 3,600 MW of wind power plants in Ca Mau by 2030.