BP ready to supply gas as 20 MW electricity for Bintuni

Oil and gas giant BP is set to supply gas from its Tangguh block in West Papua to generate 20 MW of electricity for Bintuni city. Head of the upstream oil and gas regulator (BP Migas) R. Priyono said in Jakarta on Tuesday that the company would provide 5 MMSCFD of gas to meet the electricity need.

?The company will not supply gas, but directly electricity equivalent of 5 MMSCFD. The BP has approved it," Priyono said.

The gas will be purchased by state power producer PLN that will distribute the electricity through its undersea cable network. "PLN will build the undersea infrastructure. This is just a preliminary talk and we will discuss the MOU later,? he said.

Both PLN and BP are still in talk about mechanism of the deal.

"We agree to it. Rather than asking Sir Dahlan (PLN president director Dahlan Iskan) to build a power plant to process the gas, it will be more efficient if BP directly provides the electricity," said Priyono.

Price, he added, does not matter as PLN will pay the price that will be agreed upon by both sides. "Pak Dahlan cannot afford to pay too high a price. It must be a special rate which will not be above US$10," he said. (godang)