BP Migas to sign energy contracts next week

BP Migas to sign energy contracts next week

The Jakarta Post, Jakarta

The Oil and Gas Implementing Body (BP Migas) is scheduled to
sign a number of energy contracts worth billions of dollars next
week.

Rachmat Sudibyo, the head of BP Migas said the contracts
include a Memorandum of Understanding (MOU) to sell liquefied
natural gas (LNG) to China's Shandong province.

"We are set to sign the contracts on June 25 in Surabaya," he
said after meeting with House of Representatives Commission VIII
for mines and energy on Wednesday.

The other contracts are gas purchase agreements with a number
of gas producers, notably Amerada Hess, Kideco and Santos, to
meet gas demand for the domestic market. The natural gas will be
supplied via state-owned gas distribution firm PGN to industrial
customers and power plants in East Java.

The contracts cover the sales of 1.250 trillion British
thermal units (TBTU) of natural gas worth US$4.2 billion.

State oil and gas firm PT Pertamina will also sign a working
agreement with BP Migas for the former's oil and gas blocks.

Following the introduction of Law No. 22/2001 on oil and gas,
Pertamina (like any other oil and gas company) is required to
sign a working agreement with BP Migas as a regulator in order to
work on the blocks.

Rachmat added that his office is working to finalize a gas
purchase agreement between state-owned power firm PT PLN and gas
producer ConocoPhillips. Once finalized, PLN will get additional
natural gas supply of 400 million cubic feet per day (MMSCFD)
from ConocoPhillips field in South Sumatra.

"Hopefully, we can settle it in time so that the contracts can
be signed next week," Rachmat said.