Korea buys more LNG from Indonesia

JAKARTA (JP): The State Oil Company Pertamina and Korea Gas Corporation (KGC) have signed an agreement on an additional sale of six million tons of liquefied natural gas (LNG), Pertamina announced yesterday.

A spokesman for the state oil company, Didi Sunarwinadi, said that the agreement was signed by Pertamina's president, Faisal Abda'oe, and KGC's president, C.B. Park, at its headquarters here over the weekend.

"With the agreement, Pertamina is required to export LNG to the Korean company for the next five years starting from now," he said.

Didi did not specify the details of the value of the purchase. But an informed source told The Jakarta Post that the price is slightly higher than the current price level of US$2.93 per million British thermal units (BTU), which is related to oil price development. One ton of LNG is equivalent to 51.87 million BTU.

Pertamina currently exports 4.3 million tons of LNG per annum to South Korea under 20-year contracts (since 1986) and another 1.3 million tons a year under a short-term contract.

Pertamina thus far produces some 26 million tons of LNG per annum from its plants in Arun, Aceh, and in Bontang, East Kalimantan. Around 18.3 million tons are exported to Japan and 1.7 million tons to Taiwan every year. (fhp)