Gajah Baru gas diverted from PLN to Krakatau Steel
Monday, June 25 2012 - 01:09 PM WIB
The government has decided to temporarily divert the gas from Gajah Baru field in West Natuna from the Muara Tawar power plant in Bekasi, West Java owned by state owned electricity firm PT Perusahaan Listrik Negara to the production facilities of state owned steel maker PT Krakatau Steel in Banten.
?The gas will be temporarily channeled to Krakatau Steel because PLN can not absorb the gas,? R. Priyono, Head of upstream authority BPMIGAS, told reporters on Monday, adding negotiation on the price of the gas is progress.
PLN?s President Director Nur Pamudji confirmed that PLN would not be able to accept gas from Gajah Baru until after state owned distributor PT Perusahaan Gas Negara (PGN) has expanded the capacity of its Muara Bekasi onshore receiving terminal. PGN sends gas to Muara Tawar via the Muara Bekasi terminal.
?All gas from Sumatra is pipelined to Muara Bekasi, which has a storage capacity of 530 mmscfd, before being transmitted to Muara Tawar. Muara Tawar is now at full capacity, It can?t even absorb all gas from Corridor and Jambi Merang, much less gas from Gajah Baru,? Pamudji said.
?As far as Muara Tawar is concerned, it still has spare capacity to receive the Gajah Baru gas,? he said.
PGN now gets gas supplies from Jambi Merang working area owned by state owned oil and gas firm PT Pertamina and Corridor block operated by American firm ConocoPhillips. Both are located in southern Sumatra. The gas is delivered via its South Sumatra West Java (SSWJ) pipeline to gas buyers in Banten and West Java, including PLN?s power plant in Muara Tawar.
According to Pamudji, PGN has pledged to expand the capacity of Muara Bekasi.
?I don?t know if they (PGN) have started investing (to expand Muara Tawar capacity). But they target to finish it in September 2013,? he said.
Gajah Baru field is part of the Natuna Sea Block A PSC operated by British firm Premier Oil. The government has approved the delivery of the gas to Muara Tawar under a gas swap deal with Conoco. Under the swap deal, 40 mmscfd of gas from Conoco?s Corridor originally planned to be sent to Singapore buyers, will be redirected to Muara Tawar, while gas for Singapore buyers from Corridor will be replaced by gas from Gajah Baru.
Editing by Johannes Simbolon