RI targets Southeast Asia to market its Natuna gas

JAKARTA (JP): Indonesia plans to market natural gas from the planned multi-billion dollar gas project in Natuna, Riau, to Southeast Asian and Indochinese countries.

State Minister of Research and Technology B.J. Habibie yesterday said all Southeast Asian and Indochinese countries were in the radius of Natuna's natural gas pipeline market.

"Out of this radius, Natuna's natural gas will be less competitive than liquefied natural gas (LNG)," Habibie said after addressing the German-Indonesia Forum on Saturday.

He noted that Thailand was the only country committed to buying Natuna's natural gas. Indonesia has approached its traditional gas buyers, including Japan, Taiwan and South Korea, to promote LNG from Natuna, but to no avail.

"The Natuna gas can actually be sold through piping not only to Thailand, but also to Vietnam and Southern China," Habibie said, adding that he had asked Malaysia's Prime Minister Mahathir Mohammad for permission to build the pipeline from Natuna to Rayong in Thailand via Malaysia.

According to the initial plan, the Natuna-Rayong pipeline network will pass Arun in Aceh to feed natural gas to Arun's gas liquefaction plants.

The Natuna gas project is believed to be Indonesia's largest gas field. The field is estimated to contain 222 trillion cubic feet of natural gas but only 75 percent of the gas is recoverable because of its high carbon dioxide (CO2) content.

Some of the natural gas will be pipelined directly to consumers, and some will be processed into LNG. The CO2 will also be liquefied and brought into the proposed multi-billion Membramo project in Irian Jaya for power plants and be used in making synthetic gas, methane and ethanes.

It will cost about US$40 billion to develop the Natuna gas field, build the necessary infrastructure and construct enough LNG plants to produce 15 million tons of LNG a year.

Indonesia annually produces more than 22 million tons of LNG from two gas fields, Arun and Bontang in East Kalimantan. Most of the LNG goes to Japan, South Korea and Taiwan.

Habibie said the Membramo integrated project would cost three times more than the Natuna project. The Membramo project will include the creation of rice fields along the Membramo river and the building of dams for power projects and irrigation purposes. Industrial projects will be set up downstream.

"The Membramo project will provide rice fields with good soil about the size of Java," Habibie said, adding that the Membramo project would be environmentally friendly.

He said he would bring up the idea of building the two mega projects -- Natuna and Membramo -- with German Federal Chancellor Helmut Kohl, who is visiting now, and ask for his support. (rid)