a natural gas partner
the rapidly changing world of natural gas Natural gas is the cleanest fossil fuel, bringing benefits to millions, thanks to its flexibility, ease of use and low emissions. But the world of natural gas is changing fast. New resources are being discovered and developed in remote locations, demanding innovative responses - technical, operational and economic to bring them to market. Markets are evolving. National and regional markets are becoming more and more connected as countries move to meet increased energy demand, diversify their supplies or offset declines in indigenous production. These developments present new opportunities. But they also create new challenges along the entire gas value chain. To succeed, it is not enough for gas companies to be technically and operationally efficient. They also need global scale and reach, the expertise to unlock upstream resources, the capability to construct innovative commercial agreements, and the know-how to manage the risks of sometimes volatile gas markets. Most importantly, they need to be able to work in true partnership with governments, co-venturers, customers and suppliers around the world.
a natural gas partner
a global gas company BP is a global gas company, operating on every continent. Today, gas accounts for around 40 per cent of our upstream portfolio and we re growing. Since the turn of the century, integrating geological understanding with advanced seismic technology, we have achieved the highest exploration success of all the major international companies. Now, with more than 48 trillion cubic feet of reserves, we are the second largest private producer of natural gas and the second largest supplier of gas into Liquefied l l l Maximize returns through efficient operation Create sustainable businesses that help local communities and countries support their economic and environmental objectives Offer innovative products and services to help customers manage market risk It is a set of credentials which we believe makes BP a natural gas partner in today s evolving gas market. Natural Gas (LNG) plants. We are the world s largest private marketer and trader of gas, and the largest producer and supplier of gas to the world s largest market the US. But perhaps what is most important are the long-term relationships we build with partners across our business. It is these relationships that enable us to work together to: l l l l Unlock stranded gas reserves Find and develop new resources Apply technology where it really counts Build pipelines and LNG chains building great partnerships From reservoir to market, we put great partnerships at the core of all our gas projects, building long-term relationships founded on mutual respect and understanding. It is an approach that has seen us work in a variety of cultures and countries across the world. It is an approach which we believe makes BP a natural gas partner across the gas value chain. l Secure and access premium markets This brochure gives you a glimpse of some of the partnerships we have developed. a natural gas partner
For 45 years, BP companies have worked closely with the government of Trinidad and Tobago to develop the country s oil and gas business, establish a world-scale LNG and gas-to-products business and ensure a lasting legacy of social and economic benefits. upstream
building a lasting legacy in Trinidad and Tobago Gas has the capacity to transform a nation s economy. In Trinidad and Tobago, the start-up in 2006 of the fourth LNG export facility marked a further stage in the successful evolution of the country s gas industry, and its growth as a world-scale LNG exporter. Today, Trinidad and Tobago and BP supply more gas for LNG to the US than any other country or company. BP (and before it Amoco) has played an important role in this development. We have led the exploration and development of the country s offshore gas reserves and contributed to a national energy plan. Working alongside the Government and partners in the Atlantic LNG company, we helped Trinidad and Tobago to build the country s LNG export industry, and to become the world s largest exporter of ammonia and methanol. Success has resulted in not only a world scale LNG and petrochemical business, but also a host of social and economic benefits. BP is committed to working with Trinidad and Tobago to maximise the economic value of the country s gas reserves, meet growing LNG demand and building a lasting economic legacy from gas. a natural gas partner
capturing new opportunities in Algeria CO 2 Capture and geological Storage (CCS) technologies have real potential to reduce greenhouse gas emissions. In Algeria, BP has been working in partnership with Sonatrach and Statoil, leading the way in the world s largest project to store CO 2 in a gas field. Export sales specifications require processed gas from the In Salah field to have a CO 2 concentration of less than 0.3%. But gas in the subsurface reservoirs has CO 2 in much higher concentrations between 1% and 10%. So, how could BP and its partners avoid the conventional approach of releasing the unwanted CO 2 into the atmosphere? The answer lies in the co-ordinated application of technology. Instead of being vented, the CO 2 is compressed and re-injected into the aquifer using three re-injection wells. The on-specification gas then makes its way to the markets of Southern Europe. Around one million tonnes of CO 2 will be injected into the reservoir every year for permanent storage the equivalent in carbon impact terms of taking a quarter of a million cars off the road.
The joint Sonatrach, Statoil and BP In Salah project in Algeria is the world s first full-scale project to store carbon dioxide (CO 2 ) in a gas field. It will store around one million tonnes of CO 2 each year, the equivalent of taking a quarter of a million cars off the road, while delivering gas to markets in Southern Europe. a natural gas partner
setting new standards in Indonesia Few projects face more complex challenges than the Tangguh LNG facility. Developed in the midst of one of the world s most bio-diverse regions, approximately 3,200km East of Jakarta, the project demands the very highest environmental, social and technical standards. BP and its Tangguh LNG partners* in consultation with the government upstream regulatory body BPMIGAS, are implementing an integrated social programme that will have lasting benefits. The programme will ensure that Tangguh acts as a catalyst for the economic and social development of local communities, and Indonesia as a whole. Due to be completed in 2008, Tangguh will further confirm Indonesia s status as a world-class LNG producer and see LNG exports to many different markets including China, South Korea and the West Coast of North America. *CNOOC, MI Berau B.V, Nippon Oil Exploration, KG Berau Petroleum Ltd & KG Wiriagar Petroleum Ltd, LNG Japan Corporation
In one of the most bio-diverse regions in the world, BP and the Tangguh LNG partners are constructing a technically advanced and highly efficient LNG facility, setting new standards for sustainable development and providing new supplies to growing gas markets in the Pacific. a natural gas partner
BP is working in partnership with China National Offshore Oil Corporation (CNOOC) and several utility companies from Guangdong Province and Hong Kong to develop China s first LNG import terminal and meet growing demand for cleaner energy.
meeting the demand for cleaner energy in China China s phenomenal economic growth is matched only by the outstanding growth in its energy consumption. In the two year period from 2002 to 2004, China accounted for over half of all global energy demand growth. But with economic progress come new challenges such as energy efficiency and security, and how to minimise environmental impact. Active in China for more than three decades, BP is working with Chinese authorities and companies to access a cleaner source of energy gas. The Guangdong Dapeng LNG Company s terminal is China s first liquefied natural gas import facility, bringing low carbon energy to Guangdong province and to Hong Kong. BP, the only foreign partner, has a major interest in the project and is a co-supplier of the LNG through its participation in the Australian North West Shelf project, which will supply LNG under a 25-year agreement. BP is playing a vital role in supporting China s goal to double natural gas consumption from some 3% of primary energy consumption in 2000 to 6% by 2010. a natural gas partner
unlocking gas reserves in Azerbaijan The Shah Deniz gas condensate field is located in the landlocked Caspian Sea and has potential recoverable reserves in excess of 600 bcm of gas. So transporting this gas to market presents some real challenges. Working in partnership, a BP-led consortium* has built the 690 kilometre South Caucasus Pipeline (SCP) to take the gas from Azerbaijan to Georgia and Turkey. The SCP sits alongside the BTC oil pipeline in Azerbaijan and Georgia, and connects into the Botas pipeline grid at the Turkish border. But as well as overcoming the considerable technical and construction challenges, the partners needed to work closely with a wide variety of stakeholders from national governments to individual communities and interested NGOs. Success required a deep understanding of local issues. As part of this effort, the partners carried out an extensive social investment and consultation programme for the communities along the pipeline, resulting in more than 100 re-routings. Today, the Shah Deniz field and SCP stand poised to bring new gas reserves to the region, providing greater security and diversity of supply. Further developments could open up the possibility of sales beyond Azerbaijan, Georgia and Turkey. *BP, Statoil, State Oil Company of the Azerbaijan Republic (SOCAR), LUKoil, NICO, Total, TPAO (Turkish Petroleum)
In close consultation with governments, NGOs and local communities, BP is working with its partners on the 690 kilometre South Caucasus Pipeline to unlock the Shah Deniz gas reserves, and supply gas to Azerbaijan, Georgia and Turkey. a natural gas partner
BP is working with the government of Vietnam as a strategic partner in the country s economic development. But economic growth needs power. Today, four in every ten light bulbs in Vietnam use electricity generated by natural gas supplied by BP.
supporting economic development in Vietnam Vietnam s economic growth is the second highest in Asia after China. But economic growth needs electric power - and BP, in partnership with PetroVietnam and others, is helping to supply a major share. Today, four out of every ten light bulbs used in Vietnam are powered by electricity generated by natural gas from offshore gasfields operated by BP in Southern Vietnam. To bring this about BP has worked with its partners to build Vietnam s first largescale natural gas supply chain. Gas is transported from offshore fields in the Nam Con Son basin along a 370 kilometre offshore and 37 kilometre onshore pipeline. After processing, the gas is piped to the Phu My complex of power stations, which includes the BP part-owned 720-megawatt independent power plant, Phu My 3. An investor in the country since 1989, BP s commitment has played a key role in the economic development of Vietnam. This has not only brought capital to the country, it has also served as a catalyst to increase the attractiveness of Vietnam to other foreign investors. a natural gas partner
bringing LNG and added flexibility to Spain Until recently, the majority of Spain s gas supplies entered the country from the South or East. This meant that the country had limited flexibility in its gas distribution system and that gas had to flow northwards into the Basque region. In 2003, an innovative project helped change all that and led to the construction of the first combined cycle power plant in the Basque region. The 800 MW gas-fired power station and 0.7 billion cubic feet per day LNG import facility at Bilbao is the first and still the largest integrated gas and power complex in Europe. Its development was made possible thanks to the extensive cooperation between three Spanish companies - EVE, Iberdrola and Repsol and BP, the only foreign partner. BP and partners in Atlantic LNG in Trinidad provided the LNG supply contract, while BP and the Spanish partner group contributed global and local expertise in LNG regas and power generation plant construction and operation. All shared a commitment to the highest standards of safety and environmental protection. The result is a new, strategic LNG import and low carbon power complex, which has enhanced the flexibility of Spain s gas system and helped renew economic activity and prosperity in the Basque region.
The LNG re-gasification and power plant at Bilbao is the first and still largest integrated facility of its kind in Europe, and the only one to be developed by Spanish companies in partnership with a foreign multinational. a natural gas partner
helping customers manage their energy needs in the USA In the world s largest gas market, BP is working with more than 1,000 major energy customers to offer innovative products and services that enhance energy efficiency and manage price risk. For example, BP is a pioneer in helping municipal utilities to access Another innovative product designed to help customers better manage their energy costs is the Weather Contingent Gas Daily Option. This is an insurance-type product which protects the customer against daily price spikes resulting from changes in the weather. The customer pays an upfront premium to the supplier for the right, but not the obligation, competitively priced natural gas through pre-pay contracts. These are contracts under which an agreed amount of gas is supplied over a set period of time, usually ten years. They were developed as a way for municipal utilities to reduce long-term supply costs by issuing tax-exempt debt. BP is one of only a few suppliers in the market with the expertise to execute long-term structured transactions of this kind and with the credit rating to support deals of this size. to price physical gas at an agreed fixed price every day during the month. This product will only pay out if the price spike is correlated to the temperature spike, thereby mitigating the customer s risk for a lower premium than the industry standard offering. New ideas like these add value to BP s partnerships with customers.
In the world s largest gas market, BP is working with more than 1,000 major energy customers to offer innovative products and services that enhance energy efficiency and manage risk and price volatility. a natural gas partner
Empress, Canada NGL processing plant British Trader LNG ship Wamsutter, USA gas resource Bilbao, Spain LNG re-gasification terminal and power plant In Salah, Algeria gas resource Gulf of Mexico, USA gas resource, major pipeline and NGL processing plant Point Fortin, Trinidad gas liquefaction plant Gas resources LNG ships (excluding JVs) LNG re-gasification terminal Marketing and trading hubs Tierra del Fuego, Argentina gas resource Power plants (excluding cogeneration)
North Sea, UK gas resource Kovykta, Russia gas resource South Caucasus major pipeline Kwangyang, South Korea power plant Port Said, Egypt gas resource and NGL processing plant Das Island, Abu Dhabi gas liquefaction plant Dapeng, China LNG re-gasification terminal Tangguh, Indonesia gas liquefaction plant (under development) North West Shelf, Australia gas liquefaction plant a natural gas partner
If you would like to find out more, please contact us or visit our website. www.bp.com Gas Marketing and Communications Building B BP Business Park Chertsey Road Sunbury-on-Thames Middlesex TW16 7LN Tel: +44 (0) 1932 762000 a natural gas partner