Pertamina insists on developing own LNG plant in C. Sulawesi

State oil and gas company PT. Pertamina sticks to its gun over plans to have an LNG plant of its own in Central Sulawesi, playing down the idea of just selling natural gas it had discovered in the province to an LNG plant owned by a third party, a company official said.

?Pertamina together with Medco Energi is perfectly capable of developing LNG plant on our own to tap gas from Donggi and Senoro-Toili Blocks. Pertamina doesn?t want just to sell gas to a third party,? Kun Kurnaely, President Director of PT. Pertamina EP told Petromindo.Com earlier this week. Pertamina EP is an upstream arm of Pertamina.

Pertamina has 100 percent interest in Donggi Block and 50 percent in nearby Senoro-Toili block. JSX-listed oil and gas company Medco Energi Internasional has the remaining 50 percent.

Medco had earlier signed a preliminary deal to sell gas from Senoro-Toili block to Australian firm LNG Limited, which has planned to build a 1.7 million tons per annum (MTPA) LNG plant in the block. This will make Medco and Pertamina only act as gas sellers to the proposed LNG plant. Pertamina?s stance on the matter had caused delay in Medco's inking final gas sales deal with LNG Ltd. LNG Ltd. had planned to sell the plant's future LNG production to one or more existing Indonesian LNG customers.

Kun said that Pertamina wanted to see its own LNG plant in Central Sulawesi tapping gas from both Donggi and Senoro Toili blocks to come onstream in 2009-2010 with the capacity of 2 MTPA.

?Pertamina s currently in talks with Medco over the plan (to jointly develop LNG plant),? he said. He said that Pertamina had nothing to do with talks between Medco and LNG Ltd.

Medco Energi Director Rashid Mangunkusumo told Petromindo.Com in a Tuesday Interview that talks with Pertamina were ongoing over the plan to develop the Central Sulawesi LNG plant. He, however, said that LNG Ltd. would not be left behind in the talks. ?Medco will still be partnering with LNG Ltd and LNG Ltd. might have some stake at the proposed LNG plant,? he said.

LNG Ltd. has set up a 50:50 partnership with local firm PT. Maleo Energi Utama to develop the LNG plant.

Rashid said that currently Senoro Toili has reserves of 2.6 TCF. A Pertamina official said earlier that current reserves at Donggi are between 1-2 TCF. (alex)