Pertamina, Medco to hold 20% shares each in C. Sulawesi LNG plant project

State oil and gas company PT. Pertamina said on Monday it would take 20 percent shares in the proposed Central Sulawesi LNG plant project with other Indonesian partner JSX-listed oil and gas firm PT. Medco Energi Internasional Tbk. would also take 20 percent.

Pertamina?s vice-president director Iin Arifin Takhyan told Petromindo.Com that the remaining 60 percent shares in the project is currently being contested by four bidders; Mitsui Corp., Mitsubishi Corp., LNG Ltd and Osaka Gas consortium and Japan LNG.

Iin said a selection team which comprised of Pertamina and Medco was giving first priority to two Japanese firms to develop the project. He, however, declined to give names.

Iin said selection process would be finalized in one or two weeks.

The Central Sulewesi LNG plant project would be built with capacity of up to 2 million tonnes per annum, with gas supply would come from Pertamina-operted Donggi block, and adjacent Pertamina-Medco-operated Senoro-Toili block. Both blocks. Combined proven and certified gas reserves in both blocks are 2.3TCF.

The plant would be Indonesia?s first downstream LNG project in Indonesia.

Iin said costs to develop the LNG plant was estimated at between US$600-700 million and development costs for both Donggi and Senoro-Toili block would reach $300 million.

Earlier, Medco director Loekman Mahfoedz said that the LNG plant would adopt net back system, where gas suppliers would be paid in line with LNG price sold by LNG plant.

Loekman also said that the plant is slated to become onstream in 2009.

In its recent quarterly report, LNG Ltd. said that LNG from the project would likely to be sold to Indonesian current LNG buyers. (alex)