Pertamina EP, Pupuk Kujang in $430m gas sales deal
Wednesday, January 18 2012 - 08:37 AM WIB
State oil and gas firm PT Pertamina EP and state fertilizer company PT Pupuk Kujang exchanged on Wednesday documents of a gas sales deal worth US$430.4 million in Jakarta.
The deal was signed on Dec. 29, 2011.
Based on the agreement, Pertamina EP will supply 39 MMSCFD of gas from its fields in West Java to the metering point in Dawuan in the West Java regency of Karawang.
The contract will last for 5 years, starting Jan. 1, 2012, with total volume of 70,200 MMSCF per year.
Pertamina EP President Director Syamsu Alam said the deal confirmed the company's support for domestic industry, particularly fertilizer sector, and commitment to sustainable food security.
?The commitment is part of Pertamina's values which is customer focus that promotes good governance and Health Safety and Environment,? he said
Syamsu said the gas deal and improvement in gas price would encourage producers to discover more gas reserves. Customers are expected to adapt to the new price so as to accelerate discovery efforts.
Pertamina EP is one of gas producers that supply domestic industry. About 71 percent of its sales contracts with industry sector is delivered to customers or through PT PGN, including gas for fertilizer and steel industry (19%), electricity (28,5%) and city gas and transportation.
Pertamina EP production has consistently soared over the last six years. In 2006 its production reached 869 MMSCFD, and increased by 12.7 percent in 2007 to 980 MMSCFD. In 2008 production exceeded 1,000 MMSCFD mark at 1,003 MMSCFD or 2.3 percent higher than in 2007. The trend continued with production reaching 1,043 MMSCFD in 2009, and 1,054 MMSCFD and 1,070 MMSCFD in 2010 and 2011 respectively.
Editing by David Mustakim