(Adds details and background from paragraph 2)
SINGAPORE, Sept 5 (Reuters) - BP's Tangguh Train-3 liquefied natural gas (LNG) project in Indonesia will be in commercial operation by year-end, Tutuka Ariadji, Indonesia's director general of oil and gas, said on Tuesday.
The project, which has been delayed by natural disasters as well as the COVID pandemic, will add nearly 4 million metric tons of capacity per year to the Tangguh facility.
Indonesian wants to accelerate development of several gas projects as financing for fossil fuel projects are tightening amid global energy transition campaigns, officials have said.
This year Shell and Chevron agreed to sell off their stakes in major Indonesia gas projects, which is expected to quicken development of the associated fields.
Shell agreed to sell its stake in the Masela gas project to Indonesia state energy company Pertamina and Malaysia's national oil and gas company, Petronas , while Eni will take over Chevron's stake and operatorship of the Indonesia Deepwater Development project.
Energy ministry's Tutuka told reporters on the sidelines of the Gastech conference in Singapore he hoped Eni's acquisition of the Chevron stake would be completed this month or next.
Meanwhile, Japan's Inpex - operator of the Masela project - plans to incorporate a carbon capture and storage (CCS) facility into the field's development plan. Revision of the plan is expected to be completed this year.
Tutuka told Gastech that Indonesia has 15 CCS and carbon capture, storage and utilisation (CCUS) projects in the pipeline, and hopes to spend less than $10 billion for them.
He said Indonesia is looking to add new CCS regulations to allow the government to reimburse company spending on CCS projects through a cost recovery scheme.
BP Indonesia has the biggest CCS/CCUS project, Tutuka said, and is now conducting front-end engineering design for the project, with first carbon injection expected in 2026. (Reporting by Florence Tan; Writing by Tony Munroe and Fransiska Nangoy; Editing by Muralikumar Anantharaman and Tom Hogue)
