Pertamina to sign LNG MOU with Indian firm

President oil and gas company Pertamina Baihaki Hakim said on Wednesday Pertamina would sign on Thursday a memorandum of understanding (MOU) allowing Indian state company India Oil Company to buy liquefied natural gas (LNG) from Indonesia.

 

Speaking to reporters on the sidelines of the Jakarta International Energy Conference, Baihaki said IOC would buy some 1.8 million tons of LNG per year.

 

Baihaki did not provide details on the MOU.

 

President Abdurrahman Wahid earlier said Indonesia was seeking to sell LNG to China and India. China will be supplied with LNG from the planned Tangguh LNG plant in Irian Jaya, and India with LNG from the Bontang LNG plant in East Kalimantan.

 

The Bontang LNG plant now has eight trains with a total output of 27.2 million tons per year. The gas fields, which currently provide gas supplies to the LNG plant, still reportedly has enough resources to build another train in the Bontang LNG complex.

 

It remains unclear if Pertamina would build the ninth train in Bontang to supply Indian market.

 

An analyst said an LNG train has the production capacity of about 3 million tons of LNG per year.

Thus, prior to the development of the ninth plant, aside from IOC, Pertamina has to find another buyer for the remaining LNG products of the ninth plant.

 

An executive of a production sharing contractor which has a stake in the Bontang LNG plant, told Petromindo.Com said he was surprised by Baihaki's announcement since Pertamina had not yet informed his company about the MOU plan. (*)