SHANGHAI, CHINA -- (MARKET WIRE) -- July 17, 2006 -- IBM China has delivered the business processes and technology infrastructure behind China's first Liquefied Natural Gas (LNG) Gas Project, Guangdong Dapeng LNG (DPLNG). DPLNG recently received and processed its first shipment of 66,000 tons of LNG from Australia, marking the commencement of its business operations.

Responsible for the import, storage, re-gasification and transmission of LNG for Shenzhen, Dongguan, Guangzhou, Foshan and Hong Kong, DPLNG has 11 shareholders including CNOOC, its largest shareholder (33%) and BP, its only foreign shareholder (30%).

IBM Global Business Services was contracted by DPLNG in 2005 to design the business processes and IT infrastructure necessary to support DPLNG as it prepared to transition from construction to operation.

"Establishing a solid operational foundation was imperative for the successful launch of DPLNG," said Mr. Tom King, President, DPLNG. "IBM created the business process structure that allowed us to move seamlessly from the construction phase into the operational stage.

"This foundation allowed us to receive and process our first shipment of LNG and will enable us to scale our operations to match the anticipated growth of our business," he said.

IBM took a three-phased approach to create DPLNG's operational infrastructure involving: business process design, application integration and co-ordination, and the implementation of an SAP ERP system.

During the project, IBM worked on processes to support the finance function, human resources, administration and other related operations, and assisted with the establishment and coordination of relationships between upstream and downstream business partners.

The business process design phase involved 316 business processes, including core business, financial, and commercial process as well as the operational processes for each division. The second phase involved the alignment of DPLNG's applications such as Maximo, e-banking and GMS systems with the overall IT infrastructure to deliver enterprise-wide IT support. The third phase was devoted to the implementation of the SAP ERP system, which also involved the integration of the overall IT infrastructure with the business processes.

IBM's deep industry experience, background in designing business processes and ERP implementation skills, ensured the technology infrastructure, in particular the critical SAP-related application ports, were ready for the commencement of DPLNG's operations.

The finance function, for example, is able to collect accurate financial data quickly, enabling rapid management decision-making and the efficient execution of finance related activities.

David D. Cheng, Engagement Partner of IBM Global Business Services, Greater China Group, said, "This project demonstrates the strength of IBM. We drew on our deep business and technology skills, together with global and local industry experience, to create an operational foundation to address DPLNG's current and future business needs.

"We congratulate DPLNG on receiving and processing their first shipment of LNG, and are proud of the role of IBM has played in achieving this success."

DPLNG has invested US$898 million to build a 3.7 million t/a LNG receiving station and a 383km gas transmission pipeline. The company has a 25 year contract for an annual gas supply of 3.63 million tons with The North West Shelf ALNG Company.