Pertamina to develop LNG market in India

JAKARTA (JP): The state oil company Pertamina and Coastal Corp. of the United States have agreed to develop a market in India for Indonesia's liquefied natural gas (LNG).

Pertamina spokesman M.A. Rais said over the weekend that Pertamina president Faisal Abda'oe and Coastal chief executive officer David Arledge signed a memorandum of understanding last week.

According to the agreement, Pertamina will supply LNG and Coastal will build gas-fired power plants and pipelines from India's gas receiving terminals.

Rais said the Arun gas plant in Aceh and Bontang plant in East Kalimantan would supply LNG to India.

He said LNG could be supplied from the government's soon-to-be-developed Natuna plant on Natuna island. The Natuna island was estimated to contain 45 trillion cubic feet of gas.

He said India -- with the world's second largest population -- was a new market for Indonesia, which has traditionally concentrated on Japan, South Korea and Taiwan.

Indonesia is the world's biggest LNG producer, exporting about 25 million tons yearly. About 60 percent of this goes to Japan.

State-owned Gas Authority of India Ltd (GAIL) recently called for overseas LNG supplies for its $10 billion project to diversify India's energy system.

The authority, India's main distributor and supplier of gas, planned to set up two re-gasification plants on the east and west coast, each handling at least two million tons of gas yearly, its chairman and managing director C.R. Prasad said.

Gas demand in India is expected to leap to 150 million cubic metres a day by 2000 and 200 million by 2005, prompting the call for foreign supplies.

India's gas production is expected to total 88 million cubic metres daily by 1997.

He said Indonesia was a potential supplier of LNG.

Other countries that could serve India's demand are pressing ahead with LNG projects, including Oman, Qatar and Australia. (bnt)