PGN, foreign firms form consortium to develop CBM

State-owned gas distribution company PT Perusahaan Gas Negara (PGN) and three foreign companies, including Santos and Aero and Global, will establish a consortium to jointly develop coal bed methane (CBM) into gas in South Sumatra and Kalimantan, Investor Daily reported on Wednesday.

PGN's president director WMP Simandjuntak confirmed Tuesday about the company's plan to establish the consortium with the three foreign companies, saying that PGN and the foreign companies would all have participating interests in the CBM concession areas to be developed.

"We have signed a memorandum of understanding with Santos on CBM projects. The MOUs with other two companies will be signed soon," he said.

PGN and its three partners would develop CBM mines in three major regencies in South Sumatra including Banyuasin, Musi Rawas and Muara Enim, Simandjuntak said, adding that the local governments, through their respective companies would also take part in the CBM projects.

According to Simandjuntak, the consortium would begin the CBM projects in South Sumatra next year.

Besides South Sumatra, he said, the consortium would also intend to develop CBM mines in Kalimantan. But he did not give any further information on the Kalimantan?s CBM project. (*)