ConocoPhillips mulls using PGN?s Sumatra-W. Java pipeline: BP Migas

US oil and gas giant ConocoPhillips might not have to build a dedicated pipeline to transfer gas from its Corridor gas block in South Sumatra to West Java if it is allowed to use PGN?s South Sumatra-West Java pipeline network, which is scheduled to commence construction next year, a BP Migas official said.

?If state gas distribution firm PGN allows ConocoPhillips to connect pipeline from Corridor block to PGN?s pipeline network at reasonable toll fee, then I guess it will be more economic for ConocoPhillips to use PGN?s pipeline than to construct dedicated pipeline,? said Kardaya Warnika, deputy chairman of BP Migas, Indonesia?s upstream oil and gas regulator through phone interview Wednesday. Kardaya said the scheme would also mean ConocoPhillips be able to sell its gas at lower price.

ConocoPhillips is still in talks with state electricity firm PLN to supply gas from the Corridor block to power plants in the western part of Java. Kardaya earlier told Petromindo.Com that ConocoPhillips wanted to construct dedicated pipeline if the gas supply contract with PLN has been closed. Sources say the volume of gas both companies are negotiating is up to 400 million standard cubic feet per day (MMSCFD) with first delivery expected to take place around 2007.

Separately, PGN?s president WMP Simanjuntak welcomes the plan saying that PGN will be willing to transmit gas for ConocoPhillips with ?mutually favorable terms?.

Petromindo.Com could not reach officials of ConocoPhillips for comments. (godang)