Natuna plan must run as scheduled
JAKARTA (JP): President Soeharto said yesterday that the multi-billion dollar gas liquefaction project in Natuna, Riau, must proceed according to schedule.
"The mandate from President Soeharto is that all related parties, including cabinet ministers and private companies involved in the project, should help make it run on time," State Minister for Research and Technology B.J. Habibie said after attending the first plenary meeting on the Natuna project at Merdeka Palace yesterday.
The plenary meeting, presided over by Soeharto, was attended by the Natuna project's advisory team headed by Coordinating Minister for Economy and Finance Saleh Afiff, and its management team headed by Habibie. The meeting lasted for two-and-a-half hours.
Habibie revealed that construction is scheduled to commence in early 1997 and that the engineering and designing of auxiliary facilities at the Natuna field has started.
The project, which will need a total investment of between US$38.8 billion and $41.8 billion, will include 18 offshore platforms and six gas liquefaction trains on Natuna island.
"Last month, I instructed the Agency for Technology Assessment and Application to start mapping Natuna's sea beds," Habibie said. The agency has also started mapping Natuna island.
At the meeting, Habibie was accompanied by Rear Admiral R. Maryono, chief of the Natuna project's executive board, G.A.S. Nayoan, coordinator of the gas field development, and Suleman Wiradidjaja, coordinator of the supporting facilities.
Local firms
Habibie assured that the government was counting on the participation of local private companies in developing the gas extraction project.
"I don't care who owns the companies, as long as they are incorporated in Indonesia, have experience and technology in the gas field so that they can meet international quality standards, offer competitive prices and accomplish jobs on time," Habibie asserted.
Habibie explained that his party was still negotiating with Japanese companies on the sales of liquefied natural gas (LNG) from Natuna's first two production trains.
The first two trains, which will have a combined capacity of five million tons of LNG per annum, are scheduled to start commercial production by the year 2005.
Habibie added that his party was also seeking marketing possibilities in South Korea and Taiwan for LNG from Natuna's next trains. He added that by then Indonesia would face strong competition from other countries, especially Middle Eastern countries, Southeast Asian nations, the United States, Australia and Russia.
"Therefore, it is important to accomplish this project on schedule so that when the world market is flooded by LNG from other gas fields, we have already secured our market with long- term contracts with our traditional partners," Habibie said.
Indonesia is currently the largest producer of LNG in the world, with a total production capacity of 22.2 million tons per annum or 30.2 percent of the total capacity of the existing liquefaction plants in the world. Indonesia's LNG comes mainly from two gas fields, one in Aceh and the other in East Kalimantan. Indonesia exports all of its LNG output to Japan, South Korea and Taiwan.
The Natuna gas field, located 225 kilometers northeast of Natuna island, is estimated to contain 222 trillion cubic feet of natural gas. Only 75 percent of the gas is recoverable because of the high content of carbon dioxide. The field could yield up to 15 million tons of LNG per year for 30 years.
Also on hand at yesterday's plenary meeting were Coordinating Minister for Industry and Trade Hartarto, Coordinating Minister for Political Affairs and Security Soesilo Soedarman, Minister of National Development Planning Ginandjar Kartasasmita, Minister of Home Affairs Yogie S. Memet, Minister of Finance Mar'ie Muhammad, Minister of Mines and Energy I.B. Sudjana, Minister of Tourism, Post and Telecommunication Joop Ave, Minister of Agriculture Sjarifudin Baharsjah, Minister of Transmigration Siswono Yudohusodo, Minister of Public Works Radinal Moochtar and Commander of the Armed Forces Feisal Tanjung. (rid)