NuEnergy offering CBM gas to PLN
Tuesday, May 15 2012 - 02:12 AM WIB
Australia-listed NuEnergy Gas Limited (NGY) is offering gas from its Muara Enim coalbed methane (CBM) project in South Sumatra to the state utility PT PLN, an official of NuEnergy said.
The company?s Senior Manager for Business Development and External Relations, Yales Vivadinar said in Jakarta on Monday that his company had drilled one exploration well and coring well in Muara Enim.
?The results of core drilling are being analyzed at laboratory,? he said.
But he noted that there was another option for NuEnergy. The option is to sell excess power to PLN, as the distance of the Muara Enim CBM project and the PLN grid is only 7 kilometer.
Meanwhile, Chairani Rachmatullah, PLN Senior Manager for Primary Energy Planning and Evaluation, said that if PLN was to buy the CBM gas it should be made through a contract of 5 year minimum to secure the gas supply and to make PLN investment on the power plant development more feasible.
If PLN was to buy the excess capacity of electricity produced by NuEnergy, any time the supply could be stopped as mutually agreed, since it is undertood that the PSC contractor built the power plant primarily to support its own operation, Chairani explained.
It was reported last month that NuEnergy was drilling the second well in the Muara Enim PSC program. The well, already at a depth of 712 meters, has proven 43 meters of net coal seams thus far and is planned to be drilled to a depth of 1000 meters to evaluate the deeper Petal coal formation. The drilling of the 2nd well was commenced on 1 March 2012.
When completed NuEnergy plans to convert the Muara Enim second well to a pilot production well and commence early gas production by late 2012.
Several other operators of Coal Bed Methane (CBM) acreage in the South Sumatra Coal Basin already have pilot programs in operation and are proving the prolific extent and thickness of the Suban coal seam, high permeability and early gas production.
These early results, the large gas supply deficit relative to demand in the Sumatra gas grid and recent gas prices in Indonesia for CBM in the order of $7.50/MMBTU are providing strong indicators for the future commerciality of NGY?s CBM acreage in Indonesia.
Netherland Sewell and Associates Incorporated (NSA I) are currently working with NGY and JMJ Petroleum to generate an independent resource certification confirming the prospective and contingent gas resources of all of NGY?s Indonesia CBM PSCs.
Editing by Benget Besalicto Tnb.