Medco?s Exspan abandons C. Sulawesi LNG dream
Thursday, July 22 2004 - 02:37 AM WIB
?The priority now is to commercialize Senoro-Toili block. LNG project may take years to develop,? said Exspan operations director Budi Basuki in an interview.
Budi said the most realistic project to quickly bring Senoro-Toli into exploitation stage was to build fertilizer plant. Budi said Exspan had held serious talks with state fertilizer firm PT. Pupuk Sriwidjaja to build urea and ammonia plant using gas as its feeds. ?The plan is to build US$ 400 million fertilizer complex, which will use 80 MMCFD of Senoro-Toili?s gas,? said Budi. He said the fertilizer plant is expected to become operational in 2008.
The next step, he said, is to build Dimethyl-ether (DME) plant in the complex. Budi said Exspan had held talks with two Japanese companies Mitsui Corp. and Itochu. ?We see DME plant as next step to develop Senoro-Toili, as talks with both companies are progressing. More over, Japanese government is giving strong support to the development of DME as alternative and clean fuel,? said Budi.
Budi said with current proven reserves of 1.5 TCF and probable reserves of 2.5 TCF, the block could flow up to 300 MMCFD of gas for 20 years.
Budi played down development of gas-to-liquid (GTL) plant in the block, saying that GTL plant requires very low gas prices to make the project feasibile.
Senoro-Toili block si located in the remote and undeveloped area of eastern Indonesia, making it not feasibile to pipe the gas to customers.
Alternatively, Exspan is also considering to sell Senoro-Toili's gas in the form of compressed natural gas. The company had just signed deal with state gas distribution firm PGN to supply up to 350 MMCFD of compressed natural gas (CNG).
Senoro-Toili block, which is jointly operated by Exspan and Pertamina, is part of larger Matindok block, which also include Pertamina-operated Donggi block. Pertamina?s ambition to build Indonesia?s fourth LNG center in Matindok Block had backtracked after recent exploration effort to increase the block?s reserves to at least 8 TCF-to justify for development of an LNG complex- failed to produce satisfactory results. (alex)