Pertamina, Medco pick Mitsubishi to develop C. Sulawesi LNG project
Friday, December 8 2006 - 06:21 AM WIB
Mitsubishi was picked out of several final contenders for the project including Mitsui Corp., Osaka Gas and Japan LNG.
Separately, Pertamina Vice-CEO Iin Arifin Takhyan said that Pertamina and Medco picked Mitsubishi to run the LNG plant because it offered the best arrangement. He did not give more detail.
Iin Added that Mitsubishi will also act as standby offtaker for LNG produced from the plant, which is expected to be built with capacity of 2 million tonnes per annum. He said Mitsubishi would invest US$600-800 million in the project. ?Heads of agreement will be signed by the end of this month,? he said.
Iin earlier said that the winning company will get 60 percent stake in the project with the rest equally shared by Pertamina and Medco.
The Central Sulawesi LNG plant project will get gas supply from Pertamina-operated Donggi block, and adjacent Pertamina-Medco-operated Senoro-Toili block. Both blocks have combined proven and certified gas reserves of 2.3TCF.
The plant will be the first LNG plant in Indonesia operated under downstream scheme. Under the scheme, the LNG plant will receive fee for the gas it will process into LNG and Pertamina and Medco will receive revenues based on LNG price sold minus fee.
Iin said Pertamina and Medco would have 20 percent shares each the LNG project, slated to be the country?s first downstream LNG project, where Medco and Pertamina would be paid based on the price of LNG exported. The whole LNG output would be exported to Japan, said Medco CEO Hilmi Panigoro, also in November interview.
Iin said Pertamina and Medco would spend $300 million to develop Senoro-Toili and Donggi blocks, to enable the blocks to supply gas to the LNG plant. The project is slated to be completed late 2009, said Iin. (godang)