Pertamina and CPC sign US$6 billion LNG deal

NUSA DUA, Bali (JP): State-owned oil company Pertamina signed a new contract yesterday with Chinese Petroleum Corporation (CPC) of Taiwan worth US$6 billion for 1.84 million tons of liquefied natural gas (LNG) per year for 20 years.

"This is the second contract with Taiwan. The shipments will start in 1998," Pertamina's president, Faisal Abda'oe, told reporters after the signing ceremony.

The contract was signed by Abda'oe and CPC's chairman of the board Chang Tzu-Yuan.

The first contract signed with Taiwan in the late 1980s calls for the shipment of 1.5 million tons of LNG from 1990 to 2010.

Abda'oe said that the LNG for the new contract will be shipped from Train-H, the eighth production train at Pertamina's Bontang LNG plant in East Kalimantan, which will start construction in 1999.

"The supply to Taiwan also will be supported by new gas reserves discovered by Total Indonesie, Vico Indonesia and Unocal Indonesia," he said.

Besides supplying Taiwan, he added, Train-H will also supply LNG to Japan and South Korea.

On Aug. 3 this year, Pertamina signed two extension contracts with Japanese buyers worth a total of $20.3 billion with annual deliveries of 8.4 million tons and 3.6 million tons for 20 years.

On Aug. 12, Pertamina also signed a third contract with Korean Gas Corporation of South Korea worth $3.34 billion for one million tons of LNG for 20 years starting in 1998.

Abda'oe said that the deal with Taiwan will increase Pertamina's exports to Taiwan from 10 million tons up to this month to over 33 million tons by 2000.

"This contract will bring the Bontang plant to a total capacity of 21 million tons per year, to become the biggest LNG plant in the world," he said.

Pertamina currently operates six LNG trains in Bontang and another six trains in Arun Aceh with a combined production capacity of 26 million tons per year, all exported to Japan, South Korea and Taiwan.

Pertamina is now developing Bontang's seventh train which is scheduled to come on stream in 1997 with a capacity of 2.5 million tons per year.

In a related event, Pertamina's Director of General Affairs Baharuddin said that Pertamina and Total Indonesie are now developing a new gas field in Bontang, East Kalimantan.

"Total Indonesie is now the biggest gas contractor, followed by Vico and Unocal," he said.

He said that the new field is now waiting for certification by Douglas MacNaughton, a gas research institute of the United States.

Total currently manages three gas fields in Bontang -- Pechiko, Tunu and Tambora.

Lasmo Oil is now developing two wells in the Tunu gas field in Bontang. (04)