Taiwan, Pertamina to sign LNG deal

Taiwan, Pertamina to sign LNG deal

JAKARTA (JP): State-owned oil company Pertamina will sign a
new 20-year contract with the Chinese Petroleum Corporation of
Taiwan for the sale of liquefied natural gas (LNG) worth US$6.8
billion, an executive said yesterday.

"The contract, which will be the second long-term deal with
Taiwan, will be signed at the end of next month," Pertamina's
director for general affairs, Baharudin, said after a
commemoration ceremony for Indonesia's 50th anniversary.

The first contract called for the shipment of 1.3 million tons
of LNG per annum for 20 years beginning in 1989. The Taiwan
company has also signed a short-term contract with Pertamina for
the purchase of 700,00 tons of LNG a year.

Baharudin said the planned contract will require Pertamina to
ship 1.9 million tons of LNG per annum for 20 years starting in
1998.

Pertamina will supply the LNG from Train-H, the eighth LNG
production train which will be established in 1997 at Bontang,
East Kalimantan, with a production capacity of 2.9 million tons a
year, he said.

Pertamina currently operates six LNG trains in Bontang and
another six in Arun Aceh, for a combined total production
capacity of over 25 million tons a year. The company is also
preparing the construction of a seventh production train in
Bontang with a capacity of 2.3 million tons a year.

"Train-H will be designed to annually produce 2.9 million tons
of LNG, of which 1.9 million tons will be shipped to Taiwan and
the remaining one million tons to South Korea," he said.

On Aug. 12, Pertamina signed a 20-year contract worth 3.34
billion with the Korean Gas Corp. for the sales of one million
tons per year with deliveries beginning in 1998.

Indonesia currently exports 26.3 million tons of LNG a year to
Japan, South Korea and Taiwan.

Baharudin said earlier that Indonesia will boost the
development of the giant Natuna gas project in Riau to meet the
increasing demand for LNG.

"Last week, we signed a confidential agreement with Japanese
investors on their commitment to buy more LNG from the Natuna gas
project," he said

The Japanese investors include Mitsui Corp., Mitsubishi Corp.,
Kanematsu Corp., Nissho Iwai Corp., Toyo Menka Corp., Sumitomo
Corp. and Itochu Corp., he said. (04)