PGN, Amerada Hess in S. Sumatra gas supply talks

State gas distribution firm PGN said it was in talks with Amerada Hess, the operator of Jambi-Merang JOB onshore Jambi over the possibility to buy the latter?s gas and sell the gas to West Java, PGN president said.

?We have had talks, hopefully we can sign MoU within the next few months,? said PGN president WMP Simandjuntak. He said that the gas would be transported through PGN South Sumatra-West Java pipeline, which will be completed in early 2007.

Simanjuntak expected Jambi-Merang block could deliver some 250 MMCFD to PGN. ?PGN is looking to sell 900MMCFD of gas to West Java through the pipeline in 2010 to cater to huge demand in the western part of Java,? he said. PGN had already secured gas supply contract with ConocoPhillips with peak rate of 400 MMCFD and with Pertamina with peak rate of 250 MMCFD.

Jambi Merang is located onshore Sumatra and contains the producing Gelam Field and the Pulau Gading and Sungai Kenawang fields which are currently in the pre-development stage (alex)