Pertamina plans to declare winner of Arun LNG project by April
Thursday, January 19 2012 - 12:27 AM WIB
State oil and gas company PT Pertamina is currently tendering project to revitalize the Arun LNG plant in northern Sumatera into an LNG receiving terminal with storage capacity of 125 MMSCFD. The winner of the tender is scheduled to be announced in April 2012, Nanang Untung, Senior Vice President (SVP) Gas of PT Pertamina, told Petromindo.com.
According to Nanang, the Arun LNG terminal will have larger capacity than the West Java Floating Storage and Regasification Unit (FSRU), and the planned Central Java and Belawan FSRUs because the Arun LNG facility has five tanks. Each tank has capacity to store and process 125 million standard cubic feet per day (MMSCFD) of gas, which itself is equal to capacity of one FSRU unit.
Nanang said Pertamina has set aside US$80 million to modify the Arun LNG into an LNG receiving terminal, far lower than building a new FSRU, which requires investment of between US$400 million to US$600 million.
However, Nanang admitted that Pertamina has yet to get approval from the government over gas supply from Tangguh field in West Papua, operated by BP Indonesia. ?We have sent a request letter twice to the government, but so far we haven?t received a formal approval,? he said.
He said given the government agrees to allocate gas from Tangguh, the Arun LNG receiving terminal could commence operation by the end of this year.
Pertamina has claimed that major gas buyers in Aceh, such as PT Pupuk Iskandar Muda, PT Aceh Asean Fertilizer, PT Kertas Kraft Aceh, and the province branch of state owned electricity firm PT Perushaan Listrik Negara strongly support the modification of the Arun LNG plant into an LNG receiving terminal.
The Arun gas field, currently the only gas supplier for the plant is expected to stop production in 2014 due to natural depletion of its gas reserves, thus ending the production function of the whole facility.
Editing by Roffie Kurniawan