ExxonMobil still revives plan to sell Natuna gas to Malaysia, Thailand

US oil major ExxonMobil is still reviving plan to sell its huge gas reserves offshore East Natuna to Thailand and Malaysia. However, it did not see the plan could materialize in a distant future.

?Although not intense, talks are still underway with Thailand?s PTT and Malaysia?s Petronas. ExxonMobil is also considering to bring some of the gas to West Java through pipeline,? said Abdul Kader Razak, ExxonMobil Oil Indonesia Gas & Power Marketing Market Development Manager on a sideline of a workshop Tuesday.

ExxonMobil has been for years trying to find market for its huge natural gas reserves, which would require the volume of at least 1 billion cubic feet per day (BCFD) to justify the block?s development.

ExxonMobil and its partner in East Natuna D Alpha block, state oil and gas company Pertamina had been in talks to sell some of their interest to Petronas and PTT in order to be able to clinch deal to supply gas to Malaysia and Thailand, but thus far the plan has not materialized.

Razak said that beside Malaysia and Thailand, ExxonMobil is also closely studying the possibility of piping East Natuna gas to West Java. Razak, however, did not say the volume the company was looking to supply to West Java or when the plan could be materialized. ?We are trying to cost development cost and to find the right technology,? he said in the workshop.

An BP Migas source, however, said that ExxonMobil?s plan to exploit East Natuna gas would have to wait for some more years. ?The market is not yet right. Thailand and Malaysia could not absorb East Natuna gas now. Thailand is focusing on indigenous gas, while Malaysia?s gas consumption is not growing as predicted. That?s why they are slowing down negotiation. West Java market would not be developed as stand-alone market as it won?t be economic to supply gas to Java without having Malaysia or Thai market,? said the source.

D Alpha Block contains an estimated 140 trillion cubic feet (TCF) of gas, but due to high CO2 content, only 45 TCF are thought to be recoverable commercially. The high CO2 content also makes it expensive to develop the field.

ExxonMobil has 76 percent stake in the block, while Pertamina has the remaining 24 percent.(alex)