Pertamina, S'pore firm agree on details of gas sales contract

JAKARTA (JP): State-owned oil and gas company Pertamina said on Tuesday it had agreed with Singaporean firm Gas Supply Private Limited on the details of the contracts for the supply of gas from Sumatra to Singapore.

Pertamina's exploration and production director Gatot K. Wiroyudo said in a statement the particulars of the gas sales contract were signed last Aug. 29 and the full deal was expected to be signed by both companies next month.

"It is expected that this agreement together with its supporting agreements, including gas supply and transportation, will be executed on or before Nov. 15, 2000," Gatot said.

Gas Supply Private Limited is a wholly owned subsidiary of PowerGas Ltd.

Under the agreement, Pertamina will supply the Singaporean firm with 150 million cubic feet per day (mmscfd) of gas to a peak rate of 350 mmscfd over a period of 20 years starting from 2003.

"The total contract quantity of 2.38 trillion British thermal units will generate an income in excess of US$7 billion," Gatot explained.

He said the gas would come from the gas fields in Central and South Sumatra being operated by Pertamina's three production sharing contractors (PSCs), namely Gulf Indonesia Resources Grissik, Santa Fe Energy Resources Jabung, and Gulf Indonesia Resources South Jambi.

He said Pertamina estimated the project would cost the state company and its contractors around $1 billion, including some $700 million for the development of the gas fields and plants, and $300 million for the construction of an submarine pipeline linking Sumatra and Singapore.

The contract will be the second gas sales contract to have been signed by Pertamina and Singaporean companies.

On Jan. 15, 1999, Pertamina and its contractors Conoco Indonesia Inc., Premier Oil Natuna Sea Limited and Gulf Resources (Kakap) Limited, signed a 22- year gas contract with Singaporean firm Sembawang Gas.

Pertamina will start supplying Sembawang Gas by 2001 from gas fields in the West Natuna islands, which are located in the South China Sea, through submarine pipelines.

Pertamina expects to send the first gas to Sembawan Gas in January next year, four months ahead of schedule.

This will be the first gas to be exported by Indonesia to overseas market by pipeline.

Indonesia is currently the world's largest liquefied natural gas (LNG) exporter with annual exports of 31 million tons. (bkm)