LNG exports from Aceh?s Arun NGL to drop by 50% in 2005

Liquefied Natural Gas (LNG) exports from Indonesia?s second largest LNG producer PT Arun Natural Gas Liquefaction (Arun NGL) in Lhok Seumawe, North Aceh, will continue to drop significantly within the next few years due to the decline in the supply of gas, Kompas reported on Saturday.

Arun NGL?s president Hasan Saad said in Lhok Seumawe on Friday that the continued decline in the gas supply from Exxon Mobil Oil Indonesia, the only gas supplier of the LNG producer, would result in the drop in the company?s LNG exports to 58 ships in 2005 from 113 ships in 2002.

?Two of the existing six LNG trains (processing units) are now idle due to the lack of the gas supply,? he said during the visit of Minister of Energy and Mineral Resources Purnomo Yusgiantoro at the company?s industrial site. The minister and several key officials at the ministry inspected the security situation of the LNG plant which is located in the northern part of the troubled Aceh.

The decline in the LNG exports from PT Arun would also result in the significant drop in the country?s foreign exchange revenue because each LNG tanker ship can carry 124,000 cubic meters of LNG worth between US$15 million to 1$17 million.

According to Hasan, if there is no additional gas supply, there will be only two LNG trains in operation in between 2005 and 2008, while the production will further decline to about 30 ships.

He said that the only possible alternative that could make the LNG plan to operate normally is by intensifying new gas exploration in the area. (*)