Taiwan to buy more LNG from Indonesia

Taiwan to buy more LNG from Indonesia

JAKARTA (JP): Taiwan is committed to more than doubling its
liquefied natural gas (LNG) imports from Indonesia beginning in
1988 from the current level of 1.7 million tons per annum.

The president of the state oil company Pertamina, Faisal
Abda'oe, told reporters here Saturday that he initialed the draft
agreements on the additional LNG sales to Taiwan with the
chairman of the Chinese Petroleum Corporation (CPC) of Taiwan, C.
Chang, in Denpasar, Bali, last Tuesday.

The agreements comprise a contract for the purchase of 1.7
million tons of LNG to be delivered within two years beginning in
1998 and a memorandum of mutual intent for the long-term
importation of 1.9 million tons of LNG per annum for 17
consecutive years beginning in the year 2000, Abda'oe explained
after a ceremony to commemorate Pertamina's 37th anniversary.

The ceremony also was attended by Minister of Mines and
Energy I.B. Sudjana.

Taiwan's current LNG imports of 1.7 million tons started in
1984 under a 20-year contract with Pertamina.

Pertamina's Director for General Affairs, Baharuddin, said
that the company will meet Taiwan's new LNG orders from an LNG
production unit, called Train G, which will be constructed in its
Bontang LNG complex in East Kalimantan with a capacity of 2.3
million tons a year. Construction will be funded with a loan from
the Export Import Bank of Japan.

The construction of Train G, estimated to cost Rp 1.2 trillion
(US$546.95 million), will start early next year. The unit is
expected to start production by the end of 1997, he said.

The Bontang complex currently has six production units with a
total capacity of 13 million tons of LNG per annum. Pertamina
also has an LNG complex of six production units in Aceh, with a
combined capacity of 12 million tons a year.

Baharuddin yesterday declined to elaborate on the price for
the additional supply of LNG for Taiwan, but said it will be
slightly higher than the current price level.

In comparison, Pertamina set the price of its LNG for Japan at
$3.11 per million British Thermal units (BTU) in May this year,
while its price for South Korea is about $3. One ton of LNG is
equivalent to 51.87 million BTU.

Pertamina currently exports 18.3 million tons of LNG to Japan
and 5.6 million tons to South Korea per annum. (fhp)