ExxonMobil signs Aceh gas deal<\/p>\n
Zakki P. Hakim, The Jakarta Post, Jakarta<\/p>\n
ExxonMobil signed on Friday an agreement that would secure the
\nyear's natural gas supply for fertilizer firms PT Pupuk Iskandar
\nMuda I and II ((PIM-1, PIM-2) in Aceh as the country enters
\nplanting season.<\/p>\n
The agreement, signed at the office of the Oil and Gas
\nImplementing Body (BP Migas), allows oil and gas giant ExxonMobil
\nOil Indonesia to supply 57 million standard cubic feet per day
\n(mmscfd) of natural gas to PIM-1 starting this week.<\/p>\n
ExxonMobil is currently the sole natural gas producer in Aceh,
\nand its output is largely converted into liquefied natural gas
\nfor the Arun LNG plant, which is then exported.<\/p>\n
Another deal is expected to be signed in February or March to
\nsecure about 60 mmscfd of natural gas for PIM-2, BP Migas head
\nRachmat Sudibyo said.<\/p>\n
The two deals should cover almost all of the firms'
\noperational need of 120 mmscfd of natural gas.<\/p>\n
\"The contract is a result of the government's effort to meet
\nthe gas demand in Aceh, as well as to help recover the economy
\ndevastated by the recent tragedy,\" said Rachmat, referring to the
\nmassive quake and tsunamis that hit Aceh and North Sumatra last
\nweekend, which has killed more than 100,000 people.<\/p>\n
Lili Djadjuli, PIM-1 technical and development director, said
\nthe company expected to start receiving the supply on Tuesday.<\/p>\n
The two firms have a combined annual production volume of
\nabout 600,000 tons of fertilizer, making them the largest
\nsuppliers for Aceh and North Sumatra.<\/p>\n
Fertilizer firms in Aceh have been struggling to survive
\nbecause of a gas shortage from depleted reserves.<\/p>\n
PIM-1 has been operating at below 80 percent production
\ncapacity, while PIM-2 did not produce fertilizer in 2004.<\/p>\n
PT ASEAN Aceh Fertilizer (AAF), another fertilizer firm, was
\nclosed down by the government last October because of the
\nshortage.<\/p>\n
The closure of AAF gave rise to fears that the other two
\nfertilizer producers would follow suit and disrupt the national
\nfertilizer supply.<\/p>\n
Earlier this year, South Sumatra-based fertilizer maker PT
\nPupuk Sriwijaya (Pusri) was forced to provide about 21,000 tons
\nof fertilizer to meet demand in the two provinces.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/exxonmobil-signs-aceh-gas-deal-1447893297",
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"sponsor": "Okusi Associates",
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