Pertamina assures Japanese LNG buyers

State oil and gas firm Pertamina on Monday reassures its liquefied natural gas (LNG) buyers that it will do its utmost effort to secure stable supply.

Speaking in The Second Indonesia-Japan Energy Roundtable in Jakarta Monday, Pertamina?s president Baihaki Hakim said the recent shut down of the Arun LNG plant in the restive province of Aceh had raised great concern on buyers? side regarding the stability of Indonesian LNG supply.

?Among the concerns are about the overall security condition in Indonesia especially in East Kalimantan and Irian Jaya which may affect the operation of Bontang LNG plant and the development of Bontang Train I, and Tangguh. Buyers are also concern whether the Arun problem will continue to occur and when Arun will be able to resume operations,? said Baihaki.

Baihaki went on to say that Pertamina, the government and ExxonMobil were committed to securing oil and gas operations in Aceh and were encouraged by progress made in the Arun restart activities and the security improvements around Arun.

?Regarding the situation in East Kalimantan and Irian Jaya, we do not foresee similar problems (like the one in Aceh) will occur,? said Baihaki.

Pertamina will make every effort to provide buyers with additional confidence level by providing LNG cargoes from Bontang LNG plant as contingency arrangement,? he said.

Baihaki also expressed appreciation to Japanese LNG buyers for the good cooperation, understanding and patience that they have demonstrated.

He said Arun problem gave invaluable experience: the benefit of having multiple LNG sources coordinated by Pertamina, which provides higher security of supply to buyers.

?To optimize our natural resources and to assure our LNG customers with stable LNG supply are the main considerations of the government and Pertamina to build the grass root project in Irian Jaya and the expansion project Train I in Bontang, East Kalimantan,? he said.

Both projects, said Baihaki, were expected to be ready by 2005/2006.

?Pertamina is also ready to respond to our traditional buyers? preferred terms and conditions such as shorter period contracts, price review, take or pay level relaxation and discounted price for additional volume. (alex/godang)