PGN, Pertamina sign gas supply agreement

State gas transportation and distribution company PGN said Monday it had signed gas sales agreement (GSA) with state oil and gas company Pertamina, in which the latter will supply natural gas from its South Sumatra gas field to the former starting 2006 or 2007.

?The GSA is signed today. Initial gas volume supplied by Pertamina will be 150 million standard cubic feet per day (MMCFD), ramping up to 250 MMCFD,? PGN president WMP Simanjuntak said on a sideline of the company?s new logo launch and anniversary celebration in Jakarta. The contract duration is 12 years, extendable to 20 years, he added.

Simanjuntak said the price for natural gas is set at $2 per MMBTU and will gradually increased to $ 2.6 per MMBTU.

The gas will be transported from South Sumatra to West Java, where PGN?s consumers are located, through PGN?s 550-km pipeline, whose construction is expected to be completed in 2006 or 2007.

PGN is also in advanced negotiation to transport 400 MMCFD of natural gas from Conoco-Phillips operated Corridor Block gas fields in Grissik, South Sumatra to state electricity firm through the same pipeline grid.(alex/godang)