Indonesia may cut LNG exports from Arun and Bontang

Indonesia may cut LNG exports from Arun and Bontang

Indonesia is negotiating with buyers to reduce exports from
natural gas plants at Bontang in Kalimantan and Arun in Sumatra
said Rachmat Sudibyo, chairman of BPMigas, Indonesia's state oil
and gas regulator.

Indonesia aims to cut 30 to 35 cargoes a year from exports at
Bontang because the plant has production problems, Rachmat said.
He declined to describe the problems.

The government also want to cut as many as 15 export cargoes
from Arun to supply more gas to Indonesia's fertilizer industry
Rachmat said. Arun is contracted to supply 110 cargoes this year
and 76 in 2005, said Djoko Harsono, head of marketing at BPMigas.

The government is in a talks with buyers in Japan, South Korea
and Japan, Rachmat said. Bontang has a commitment to sell 355
cargoes this year and 360 in 2005, Harsono said.

Total SA, Unocal Corp. and Eni SpA and BP Plc have shares in
fields that supply the Bontang plant. They are having problems
meeting production targets, Harsono said, in part because of a
lack of necessary equipment.

"The current increase in oil price has caused a shortage of
heavy equipments such as rigs.," Harsono said. -- Bloomberg