Unocal sells Sarulla project to PLN

Unocal sells Sarulla project to PLN

EL SEGUNDO, California: Unocal Corp. agreed to sell its interest in the Sarulla geothermal project to PLN, the Indonesian state electricity company, for US$60 million, resulting in a third- quarter gain.

The sale includes the operations and sales contracts the Unocal North Sumatra Geothermal Ltd. unit signed with Pertamina and PLN in 1993.

The unit's exploration activities discovered commercial geothermal resources in Silangkitang in 1995, but a presidential decree postponed the project in 1998, due to the economic crisis in Indonesia. The presidential decree was later revoked, the company said.

In a press release on Monday, Unocal said its legal, technical, and commercial requirements to invest further in the project could not be satisfied after several months of negotiations.

The oil and gas producer expects to close the sale in September. -- Dow Jones