Gas and pipeline agreements signed in Surabaya

Several leading energy firms, including state owned firms PT Pertamina, PT PGN, PT PLN and Medco Energi Internasional, signed on Friday in Surabaya several agreements for gas supplies and utilization of gas pipelines.

Medco Energi E&P Indonesia, the subsidiary of publicly-listed Medco Energi Internasional, signed two agreements with state-owned electricity firm PT PLN.

The first agreement is an amendment agreement for natural gas supply from Medco E&P?s Tarakan block in East Kalimantan to PLN?s Gunung Belah combined cycle power plant. A total of 9.5 trillion British terhmal units (TBTU) of natural gas will be supplied from the Tarakan block to the power plant over 8 years period.

The second agreement is the Heads of Agreement for gas supplies totalling 8.7 TBTU of gas supply for 11 years. The gas will be delivered to PLN?s 2x50 MW Keramasan gas-fired power plant in South Sumatra from Medco?s Singa field in the Lematang block of the same province. This power plant is scheduled to commence operation within the next 8 to 9 months.

Aside from Medco E&P, state-owned oil and gas firm PT Pertamina, as the operator of the East Java Gas Pipeline (EJGP), also signed two agreements on the same occasion. Pertamina and state-owned gas distribution PT PGN signed an accord allowing PGN to use the EJGP pipeline to deliver gas from the Maleo field to its customers in the mainland of East Java. The Maleo field is operated by Australian firm Santos.

The second agreement signed by Pertamina is the tie-in agreement with Santos that will enable the latter to attach its Maleo?s pipeline to the EJGP pipeline.

Both Pertamina agreements follow the Gas Sales Agreement (GSA) between PGN and Santos signed earlier for the supplies of about 240 billion cubic feet of Maleo field's natural gas gross reserve. Under the GSA, Santos will supply gas at a plateau rate of up to 110 million standard cubic feet per day to East Java.

Also on the same occasion, East Java-based natural gas producer Kodeco Energy signed a Memorandum of Understanding with the local administration of Gresik, East Java, and private company Yudistira Energy for development a liquefied petroleum gas plant in the province. (alex)