Japanese buyers agree to extend Donggi-Senoro LNG HoA deadline
Friday, May 1 2009 - 01:22 AM WIB
The LNG will be supplied from the LNG plant to be built by DSLNG in Central Sulawesi.
?Kansai and Chubu granted us another extension until the end of May,? Karen Agustiawan, Pertamina?s president director, said on Wednesday. ?In business, we can always negotiate.?
DSLNG is a company formed by Mitsubishi Corp. (51 percent), Pertamina (29 percent) and Medco (20 percent) to run the proposed 2MTPA LNG, which will operate as downstream industry with operations seen in 2012-2013.
Earlier, Pertamina?s Vice President for LNG Businesses Hari Karyuliarto said that the DSLNG had asked Kansai and Chubu to extend the head of agreement (HOA), which expired on March 31, 2009 to three weeks to give them time to get the government?s approval.
The construction of the LNG plant might be delayed by the government?s insistence on a number of preconditions related to the gas-sale deals, including approval by the Business Competition Supervisory Commission or KPPU by June 9.
Energy and Mineral Resources Minister Purnomo Yusgiantoro said last week that Lemigas, the ministry?s research agency, had found that the Donggi Senoro block held smaller reserves than previously thought, throwing into question the consortium?s ability to annually produce 2 MTPA of LNG per year.
This followed statements from the minister this month that he could be vulnerable to charges of corruption if he approved the provisional gas-sales agreements because they contradicted government policies prioritizing domestic fuel needs.
The minister also said that Mitsubishi needed to address allegations of manipulative behavior in bidding for the contract to build the LNG plant.
Meanwhile, KPPU, on Thursday asked upstream oil and gas regulator BPMIGAS to clarify its role in the tender to build an LNG plant on the Donggi Senoro site in Central Sulawesi. (*)