ASEAN asks RI to rescue AAF fertilizer plant
Monday, September 29 2003 - 03:39 AM WIB
The shareholders are the governments of five ASEAN members: Indonesia, Malaysia, Singapore, Thailand and the Philippines.
AAF president director Rauf Purnama the shareholders had expressed their objection to the halt of the gas supply which had forced the fertilizer plant to stop operation. "They have asked the ministry of finance to soon settle the dispute over the pricing of the gas for the plant," he said.
ExxonMobil has halted gas supply to the AAF plant as the finance ministry refused to meet its price demand. ExxonMobil's gas production is actually enough only to meet its LNG export commitment. To enable the company to allocate a part of its gas output for the AAF fertilizer plant, the finance ministry has asked the East Kalimantan-based Bontang LNG plant to cover part of the export commitment.
ExxonMobil has agreed to follow the government's arrangement as long as the price is based on the international price level. At present, the price of gas for local industries is set at US$1.5 per, far below the international price of US$3.
AAF was built in 1983 with Indonesia as the majority shareholder holding a 90 percent stake. The other 10 percent are shared by the other four ASEAN members. The fertilizer company, which produces about 627,000 tons of fertilizer a year, needs at least 60 million cubic feet of gas per day. (*)