Domestic buyers offer to buy Senoro gas at $4 per mmbtu

Local companies have offered to buy gas from the Donggi-Senoro block in Central Sulawesi at about US$4 per million british thermal unit (mmbtu).

But the offering price is still lower than the $6.16 per mmbtu at wellhead proposed by joint operating body (JOB) Pertamina- PT Medco Energi International.

Director General of Oil and Gas at the Energy and Mineral Resources Ministry Evita Herawati Legowo said last week that her office were facilitating negotiations to enable the two parties to close the price gap.

A number of local companies including PGN, PLN, Pusri and PT Panca Amara Utama have expressed interest to buy LNG from the proposed LNG project, but no firm commitment has been made. They said that the price offered by Pertamina and its partners for the Senoro LNG was too high.

Pertamina and Medco plan to build a liquefied natural gas (LNG) plant in Central Sulawesi in cooperation with Japanese company Mitsubishi. Gas for the proposed plant will be supplied from Matindok-Donggi Block, which is operated by Pertamina, and Senoro-Toili Block, which is jointly operated by Pertamina and Medco.

The consortium initially planned to sell the LNG to Japanese buyers but the government decided recently that the gas from Matindok and Senoro-Tolli fields should be sold in the domestic market. (*)