E. Java Power, Pertamina sign gas supply agreement
JAKARTA (JP): Private electricity company PT East Java Power Corp. signed yesterday an agreement with state-owned oil company Pertamina to supply natural gas to its 500 Megawatt (MW) power plant in Pasuruan, East Java.
The agreement was signed here by Pertamina's president Faisal Abda'oe and East Java Power's president Robert Baldwin Junior.
According to the agreement, Pertamina will supply about 30 billion cubic feet of natural gas per year to East Java's combined cycle power plant.
The gas will be supplied from an offshore gas field 62 kilometers east of Surabaya and 16 kilometers off Madura island, operated by Pertamina's production sharing contractor Mobil Madura Straits Inc.
Pertamina will deliver the gas via a 60 kilometer underwater pipeline to be constructed from the Madura gas field to the processing plant on Kambing Island and on to East Java Power's power plant in Pasuruan.
East Java Power is 50.1 percent owned by Enron Java Power Corporation, an affiliate of Enron International of the United States; 25 percent by PT Pasuruan Power, controlled by Bambang Trihatmodjo, President Soeharto's second son; and 24.9 percent by Prince Holdings Ltd. of Hong Kong.
East Java Power signed a power purchase agreement with state- owned electricity company PLN in November 1996 to purchase power from the gas-fired combined cycle power plant under a 20-year build-operate-own scheme. PLN will buy the power at 5.76 US cents per kilowatt hour (KWh).
The power plant, worth US$575 million, is scheduled to come on stream in early 2000.
Mobil Madura Straits, operator of the Madura offshore gas field, is a consortium consisting of Mobil Corporation of the United States (69 percent) and Husky Oil International Ltd. of Canada (31 percent).
Mobil Madura said yesterday it would invest US$300 million to build an offshore gas rig, processing facilities on Kambing Island and the 60-kilometer pipeline linking the gas field, Kambing Island and East Java Power facilities.
The company said the gas field, which contained 455 billion cubic feet of natural gas, was scheduled to start production in 2000. (jsk)