PGN inks MOU with 10 firms

JAKARTA: State gas distributor PT Perusahaan Gas Negara (PGN) signed on Thursday a memorandum of understanding (MoU) with 10 companies in East Java to supply them with a total volume of 13,437 million standard cubic feet per day (mmscfd).

The 10 firms are Master Steel, Asahimas, Metropole Megah, Iglas, Philips Indonesia, Walet Kencana Perkasa, Megamarine Pride, Indo Zinc Diecasting, Sasmita Abadi Gloves and Hp Metals Indonesia.

The supply is expected from gas blocks in East Java, including from Santos, Energi Mega Persada's Rancak and Terang Sirasun.

The MOU is a follow-up to the first deal signed on June 10, 2005, between PGN and 48 companies with a total volume of 110 mmscfd, the company said in a statement.

The rising demand for natural gas is caused by the skyrocketing global oil prices and lack of new sources.

In the statement, PGN hoped its buyers would increase the level of the MOUs to Head of Agreement (HOA) and Gas Sales Agreement (GSA) in the foreseeable future. -- JP