Gulf agrees to send more gas to Caltex
Gulf agrees to send more gas to Caltex
JAKARTA (JP): Gulf Indonesia Resources Limited, in which Gulf
Canada Resources Limited holds a 72 percent stake, said on
Tuesday it and its partners reached an agreement in principle for
additional gas deliveries to PT Caltex Pacific Indonesia.
Gulf said in a press release the gas would be delivered from
the Corridor Block in South Sumatra to the Duri oil field owned
by Caltex in Central Sumatra.
The Corridor Block is 54 percent owned by Gulf, 36 percent by
Talisman (Corridor) Ltd, a wholly owned subsidiary of Talisman
Energy Inc., with the remainder held by state oil and gas company
Pertamina.
The terms of the agreement include a contract quantity of 1.1
trillion cubic feet (TCF) of gas to be delivered over 20 years
and exchanged for Duri crude oil, Gulf said.
Gas deliveries are expected to commence in 2002 at 90 million
cubic feet per day (MMCFD), increasing to 180 MMCFD by mid-2003,
it added.
The statement said the natural gas would be delivered after
the installation of compression facilities through the existing
544-kilometer Grissik to Duri pipeline owned and operated by
state gas distribution company PT Perusahaan Gas Negara (PGN).
"Detailed agreements are now being finalized with execution
targeted for late in the fourth quarter," it said.
The agreements will be subject to approval by Pertamina, PGN
and the respective shareholders of Caltex and the Corridor Block
PSC participants.
Gas supplied under the new contract will supplement the gas
that is currently being delivered from the Corridor Block PSC to
the Duri Steamflood operations at rates of about 300 MMCFD, the
company said.
Contract quantities under this initial agreement with Caltex
will decline to 245 MMCFD in mid-2003. Total combined gas
deliveries under both contracts are expected to be 425 MMCFD by
2003.
"This is a great deal for all parties and further strengthens
the role of natural gas as a strategic resource for Indonesia,"
Gulf Indonesia president and chief executive officer Bill Fanagan
said in the statement.
"Importantly, the deal will allow additional Indonesian crude
oil exports in the future, thus providing increased foreign
exchange earnings for the country," Fanagan added. (jsk)