No decision yet on allocation of MDA-MDH gas

Minister of Energy and Mineral Resources Jero Wacik said he has yet to decide on the allocation of gas from MDA-MDH field in Offshore Madura Strait in East Java operated by Husky-CNOOC Madura Ltd.

Jero said during the hearing with the hearing with the House of Representatives? Commission VII which oversees among others energy affairs that PT Petrokimia Gresik (PKG) has asked to become a taker of the gas, while upstream authority SKK Migas has recommended the gas be supplied to meet the electricity needs in Sumenep regency on Madura Island, East Java and Bali.

Under the exiting law, the right to allocate gas lies with the minister. Under the Minister of Energy Mineral Resources Decree No. 03/2010, gas should be prioritized for projects to increase national oil and gas production, fertilizer industry and power generation.

In response to the PKG?s request, Jero said, the government is still studying the reliability of gas pipeline that will be used to channel the gas from the field to the state owned petrochemical firm located in Gresik.

?The pipeline is now under review. If it is reliable, I don?t mind the gas being delivered to PKG,? he said, while noting that the pipeline in question is around 19 years old.

The gas that will be transmitted through the pipeline has a high pressure, which may cause danger around the area in case of explosion.

As a matter of fact, PKG has been selected to get a gas allocation from Tiung Baru field in Cepu block. However, following the discovery of a significant gas reserve at MDA-MDH field, PKG came to ask for gas from the field.

Editing by Johannes Simbolon