Arun LNG plant to reduce production

PT Arun Natural Gas Liquefaction (NGL) has stopped activities at one of its six liquefied natural gas (LNG) trains in Arun, Aceh since last Wednesday and will shut down another one in April following the cut in orders from Japan.

Sources said that the company would only operate four LNG trains beginning April to meet long-term orders from the Japanese buyers.

PT Arun NGL, a joint venture between Pertamina, Exxon Mobil Corp and a Japanese consortium, previously operated six LNG trains, each with an annual production capacity of 2 million tons.

One of Japanese buyers has decided not to extend its long-tem order to buy LNG from Indonesia when the existing contract expired in line with the diversification of the country's energy sources.

Pertamina officials were not available for comments. The state oil company's president Martiono Hadianto has denied about the cut in the Japanese imports.

He said that the Japanese buyers did not cut the import but would reduce the order after the current contract expired in the next few years.

According to him, the planned cut in the order was not due to a change in the Japanese energy policy but due to a decline in natural gas reserves in Arun. (*)