BPMIGAS, Western Buyers extend HOA for Bontang gas sale

The oil and gas upstream regulator BPMIGAS and Western Buyer of Japan have agreed to extend the preparatory period for gas sales agreement (GSA) of natural liquefied gas (LNG) from Bontang.

BPMIGAS Chairman R. Priyono said in Jakarta on Thursday that the extension was made as their their Head of Agreement (HOA) will no longer be valid after March 31, 2010.

?The HOA stipulates that it will only last until March 31. But if I?m not mistaken, article 17 of it mentions about the possibility of extending the preparatory period before signing the GSA. This GSA will mark the extension of gas purchase contract to the Western Buyer since 2012,? he said, adding, ?the sale contract extension with Japan will be signed soon.?.

According to him, the HOA extension period will be valid for one month, which is enough for them to make any further preparations before signing the purchase contract. ?We?ll do the best we can to make it ready in less than one month. But this will depend on an approval from the minister of energy and mineral resources,? he said.

He noted that there were a number of conditions of precedence (CP) that had not been settled yet. But it has nothing to do with the extension of Mahakam Block contract to Total E&P Indonesia. (*)