Govt to set aside part of Chevron E. Kalimantan deepwater gas reserves for PKT

Government will allocate part of Chevron Corp. gas reserves in its East Kalimantan deepwater project to supply fertilizer maker PT.Pupuk Kalimantan Timur (PKT) Minister of Energy and Mineral Resources Purnomo said during a meeting with VP Jusuf Kalla on Thursday.

According to an article at the Ministry?s website released Friday, Chevron would supply PKT for 10 years starting 2013. He did not give detail about supply volume, but said that the deep water project might produce gas up to 900MMCFD.

The government has approved Chevron?s deepwater project Plan of Development on August 29, 2008.

Gas supply to PKT, he said, was part of the contractor?s obligation to supply domestic market DMO. Under the DMO scheme, contractors have obligation to sell at least 25 percent of its gas production to domestic market.

Currently, PKT gets its gas supply from East Kalimantan gas producers through 4 contracts namely: PKT1: 80MMCFD until 2011, PKT2: 70MMCFD until 2017, PKT3: 43MMCFD until 2017, PKT4: 48MMCFD until 2021.

According to Purnomo, government has allocated 80MMCFD for PKT1 contract extension.(denny)