House members support rescheduling of LNG exports
Wednesday, December 1 2004 - 03:28 AM WIB
"The government's plan to reschedule LNG exports is quite realistic," said the head of the Commission VI of the House, Khofifah Indar Parawansa said during a hearing with Minister of Industry Andung A. Nitimihardja on Monday night.
During the hearing, the DPR members also supported the plan to merge AAF plant with state owned PT Pupuk Iskandar Muda, also located in the province. The government has been asked to stop the operation of AAF - which is jointly owned by ASEAN member countries Indonesia, Malaysia, Singapore, the Philippines and Thailand - due to continued decline in the raw material gas supply.
Minister of Industry said that the rescheduling of the LNG export might be the best alternative in preventing the AAF plant from being closed because BP Migas, the government's authority in charge of oil exploration and production, had yet to sign a gas supply agreement.
Commenting on the proposed rescheduling of the LNG exports, the marketing director of Pertamina said: "The government should first study the impact of the export rescheduling such as the decline in foreign exchange earning from LNG exports.
"The operation of a fertilizer plant will result in the decline in LNG export by six cargoes which are worth about US$132 million," he said.
The deputy of BP Migas, R.S Trijana Kartoatmodjo said that PT Arun's LNG has the commitment to export 76 cargoes next year, or three cargoes below its production capacity of 79 cargoes.
"With assumption that the two fertilizer plants will require about 12 cargoes a year, PT Arun needs additional supply of nine cargoes to keep the two fertilizer plants in operation," he said. "If LNG buyers do not agree with the export rescheduling, the government has to go to the spot market to seek for the shortage," he added. (*)