BP Indonesia clarifies

BP Indonesia clarifies

Allow me here to give some input with regards to the news
coverage from The Jakarta Post dated June 9, 2003, titled Gas
shortage to exacerbate power woes on Java, on page 1.

In the sixth column of the article, in the last paragraph, it
is written that BP has a monopoly right to supply 600 MMSCFD gas
to regional customers until 2010. Other companies are not
permitted to supply gas to the market unless the gas demand does
not exceed more than 600 MMSCFD.

It is true that in our gas supply contract it is stated that
Kangean PSC has preferential rights to supply the East Java
market if there is available gas reserves and deliverability and
the gas price is competitive. If Kangean PSC does not have enough
gas then any PSC can supply the market. Or if any PSC can offer a
lower price then they can supply the market.

We do not view this preferential right as a monopoly right. In
fact, other gas producers (Kodeco and Lapindo Brantas) have been
supplying gas to customers in East Java without having to ask BP
Kangean Ltd. It is also true that in 2001 we formally agreed to
withdraw the preferential rights. The existing gas contract is
being revised.

Therefore, we wish that in the future the issue of monopoly or
preferential rights not be mentioned if the Post writes about our
operations in the Pagerungan gas field, Kangean block, East Java.

SATYA W. YUDHA, Vice President of Government and Public Affairs,
BP Indonesia, Jakarta

Note: Thank you for your clarification. --Editor