BPMIGAS proposes ?middle way? over LNG plants ownership controversy

Indonesian upstream authority BPMIGAS is offering ?middle way? over controversy of ownership of Bontang and Arun LNG plants, a senior official said.

?What we are suggesting is LNG plants will remain as government?s asset via BPMIGAS, and Pertamina will be appointed operator of the LNG plants,? said BPMIGAS vice-chairman Kardaya Warnika.

State oil and gas company Pertamina had insisted that government to transfer ownership of LNG plants when its status would be changed into limited liability company this year, but gas suppliers had objected to the proposal for fear that it would cause conflict of interests as Pertamina is also planning to develop its own LNG plant in Donggi, Central Sulawesi. Kardaya admitted that gas producers feared that Pertamina might arbitrarily increase processing fee, which will make Bontang LNG price less competitive.

?With that compromise, Pertamina will still carry flagship as operator and will continue to manage LNG plants with its competency, but BPMIGAS will ensure Pertamina not to act arbitrarily at cost of gas producers,? said Kardaya.

The government is expected to decide over assets transfer to Pertamina soon.

Indonesia is currently world?s largest LNG producer and exporter from Arun and Bontang LNG plants. (alex)