PT Medco, Pertamina To Review Reserves Before Setting Up LNG Plant In Sulawesi, Indonesia

Published: 22-Apr-2009

By: Staff Writer Staff Writer Staff Writer

PT Medco Energi Internasional Tbk (PT Medco) and PT Pertamina (Pertamina) should evaluate the size of natural gas reserves before constructing a liquefied natural gas (LNG) plant in Sulawesi, as said by the ministry officials. Pertamina, PT Medco, and Mitsubishi Corporation have decided to construct the $1.4 billion Donggi-Senoro LNG plant in Sulawesi, with a capacity of two million tonnes annually. It will get natural gas supplies from Pertamina and PT Medco.

Mines and Energy Minister, Purnomo Yusgiantoro said, “The ministry has found that the gas reserves in Sulawesi are lower than their (the contractors) finding.”

Previous month, PT Medco inked an agreement to supply a total of two million tonnes a year of LNG to two Japanese customers.

According the agreement, PT Medco will sell one million tonnes of LNG from the Donggi-Senoro LNG plant to Chubu Electric Power Co and one million tonnes to Kansai Electric. The contracts will run for 15 years.

Yusgiantoro said other issues would also require being resolved together with domestic gas supplies from the Sulawesi gas reserves and the price.

The project has been condemned by legislators as they said the price at which the natural gas will be sold to the LNG plant is too low.

The plant should give LNG production in Indonesia a much required boost as the nation struggles to manage exports and local requirements.

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