Nissho Iwai buys RI stake

Nissho Iwai buys RI stake

TOKYO (Dow Jones): Company sources said Nissho Iwai Corp., a general trading company, has bought a stake in a natural gas development block in Indonesia to develop new natural gas fields, the Nihon Keizai Shimbun reported in its Thursday morning edition.

The company, which handles some 80 percent of Japan's liquefied natural gas imports from Indonesia, hopes to launch production as early as 2005 and plans an annual output of 6 million tons of LNG for 20 to 25 years, the leading business daily reported.

Nissho Iwai, via a subsidiary, bought a 5 percent stake in a development block in eastern Irian Jaya of Indonesia. The block, which has proven gas reserves of 3.1 trillion cubic feet, is owned 50 percent by British Gas Plc., and 45 percent by a Malaysian company, according to the report.

The gas deposit extends beyond the block and is estimated at 10 trillion cubic feet.

In 1988, Indonesia accounted for more than 50 percent of Japan's LNG imports. However, increased imports from Australia and the Middle East brought the ratio down to 36 percent in 1998.