Govt approves price formula for Senoro gas

The government has approved the price formula for the sale of gas from the Senoro-Toili gas block in Sulawesi to PT Panca Amara Utama, which will use the gas for its ammonia plant, Kontan reported on Friday.

Imron Gazali, the corporate secretary of PT Medco Energi Internasional Tbk, said that Panca Amara would buy 55 million standard cubic feet per day (mmscfd) of gas from the Senoro-Toili block under a 12-year contract beginning 2015 at a price linked with the price of ammonia.

?If the price of the ammonia is $660 per ton, the price of gas will be between $7.1 and $7.2 per mmbtu,? he said.

He said that the government?s approval paved the way for further development of gas wells in the gas block. At present, the block has produced 1,900 barrels of oil per day, while the gas production is expected to begin in 2015.

The Senoro-Toili gas block is operated by a consortium consisting of Pertamina, with 50 percent stake, Medco with 30 percent stake and Mitsubishi of Japan with 20 percent stake.(*)