The deal, announced last month during President Susilo Bambang Yudhoyono’s state visit to London, will allow BP to develop a third liquefied natural gas (LNG) liquefaction train at its Tangguh project in West Papua province, according to a statement from BP Indonesia.
“The plan of development for a third LNG train at Tangguh has now been fully approved,” BP’s Asia-Pacific regional president William Lin said in a statement.
“This is an important milestone towards realising this significant development, and we appreciate the government granting full approval,” he added.
BP is one of Indonesia’s largest foreign investors and holds a 37.16 percent stake in the Tangguh plant, which began operations in mid-2009.
Indonesian Papua, in the eastern part of the archipelago, is rich in resources, drawing big investments from foreign firms.
But the local population, which is mostly ethnic Melanesian, is claiming a bigger share of the profit, which has led to a low-level insurgency by separatist groups.