Japan urges RI to soon resolve LNG talks
Wednesday, May 17 2006 - 11:50 PM WIB
Japan?s energy-hungry manufacturers are still awaiting a commitment from Indonesia on the future supply of LNG when their contracts expire in 2010.
After meeting Vice President Jusuf Kalla, newly appointed Japanese ambassador to Indonesia, Shin Ebihara, told reporters that the extension of the LNG contracts was an important issue that needed to be settled immediately to ensure certainty of supply.
?This is clearly an important issue. In this meeting, we briefly touched on the subject, but we did not go into details. We hope the negotiations will be settled as soon as possible in a mutual satisfactory manner,? said Ebihara.
He explained that the governments of the two countries could not intervene in the detailed negotiations as this was a purely business-to-business matter between private sector players from the two countries.
The Indonesian government has announced a new policy of prioritizing gas supplies for the domestic market, with the government planning to build inter-island pipelines to channel the gas to Java where demand is rising.
Indonesia has announced it will cut its LNG exports by 10 percent in 2006 due to lower production from aging gas fields in the provinces of Nanggroe Aceh Darussalam and East Kalimantan.
Japan?s energy needs are expected to increase with projected higher growth amid a continuing economic recovery.
State-owned oil and gas firm PT Pertamina - the government appointed LNG vendor - is currently holding talks with Japanese buyers to seek ways of reducing LNG supplies without causing losses to any of the parties involved. (*)