Donggi-Senoro gas scenarios: most likely for exports

The government has prepared four scenarios for the Donggi-Senoro gas production, three of which will dedicate the gas for export market, Kontan reported Monday.

According to a document obtained by the newspaper that the government preferred the first and second scenarios under which the Donggi-Senoro gas will be exported so that the government will get the revenue. In the first scenario, 335 MMscfd will be exported, with domestic portion being 70 MMscfd.

In the second scenario, all the gas will be sold to consortium PT Donggi-Senoro LNG (DSLNG), that will operate an LNG plant.

Under the third scenario, 70 mmcfd of the gas will be allocated for the domestic market and 265 mmscfd for the export market. Under the fourth scenario, all the gas will be sold on the domestic market.

According to the document, the government favors the first and second scenarios on the grounds that it will get higher revenue.

The government will get a total revenue of US$6.4 billion if the first scenario is implemented, and $5.7 billion under the second scenario.

The third scenario is not favored because it requires a redesign of the LNG plant, which will cause a delay in the development of the plant. Furthermore, no investors will be interested to build an LNG plant based on 265 mmcfd gas supply, because such a project will not be economically feasible.

The fourth scenario is the least-favored because the domestic market is still too small to absorb all the gas. (*)