Petronas confirms gas negotiation resumes January: Report
Tuesday, January 15 2002 - 07:55 AM WIB
A Petronas official said Tuesday that the negotiations for his company to purchase natural gas from Pertamina have been ongoing for about a year.
The Petronas official declined to give further details of the talks regarding the East Natuna Sea gas as he was prohibited by a confidentiality agreement.
He also declined to comment when asked about a possible target date for the conclusion of the talks with state oil and gas company Pertamina.
Petronas has been eyeing 1 billion standard cubic feet a day of gas offtake, starting in 2010, from the Natuna D-Alpha gas block in the East Natuna Sea.
D-Alpha block has an estimated 42 trillion-46 trillion cubic feet of recoverable natural gas reserves, according to previous reports. Despite a high content of carbon dioxide which inflates development cost, the estimated reserve is "still enormous," an industry official in Indonesia said.
ExxonMobil Indonesia Inc., a unit of Exxon Mobil Corp. holds 74 percent and operates the D-Alpha gas project. Pertamina holds the remaining 26 percent in the D-Alpha gas block.
Besides the D-Alpha block, Petronas is keen on gas offtake from the West Natuna Block A gas field, where Premier Oil PLC operates. Petronas has an indirect stake in Indonesia gas assets through its 25 percent stake in Premier.
In March last year, Petronas and Pertamina signed a comprehensive natural gas sales agreement valued at $2.9 billion.
Under the terms of the agreement, Pertamina will begin delivering gas from the West Natuna Sea area to Malaysia starting mid-2002 for 20 years. The West Natuna Sea gas is to be channeled to Petronas offshore facilities in the eastern state of Terengganu.(*)