Indonesia close to signing third gas pact with Singapore: Report
Wednesday, December 4 2002 - 01:22 AM WIB
"We are in the final stage of negotiations (with Island Power Co Pte Ltd). Terms and conditions are already completed, but the contract - which has not yet been signed - is subject to Singapore's electricity deregulation," Trijana said.
Trijana is deputy of operations at BPMIGAS, an Indonesian governmental body that oversees the country's upstream oil and gas activity.
"Otherwise, it is just a piece of paper," he stressed of the preliminary deal for "no more than 80 million cubic feet a day of natural gas" to be delivered from Sumatra starting 2005.
Under the contract, the first piped gas delivery to Island Power, a unit of InterGen, will coincide with the start of operations of a proposed power plant in 2005.
The contractual gas price to Island Power will be "very similar to the Singapore Power deal, with insubstantial difference," Trijana said.
A deal with Island Power would add to SembCorp Industries Ltd's current Natuna natural gas imports, and Gas Supply Pte Ltd's contract for South Sumatra gas from next year.
Gas Supply, a unit of Singapore Power Ltd., earlier signed a contract with Indonesia to buy natural gas from South Sumatra starting late 2003.
InterGen is a power developing venture between Bechtel Group Inc and the Royal Dutch/Shell Group (RD).
Singapore's electricity sector is embarking on a gradual deregulating process with the new market to be launched Jan. 1.
The "new electricity market," which modifies an existing electricity pool, is expected to generate more reactive, nimble electricity trade between generating companies and retailers, sources said.
But stake sales in three power generating companies owned by the Singapore government's investment arm Temasek Holdings Pte Ltd have been postponed by more than a year to 2004-2005, because of weak market conditions. (*)