PGN, PLN reach agreement on gas price
Tuesday, June 12 2007 - 02:03 PM WIB
State owned gas company PT Perusahaan Gas Negara (PGN) has reached an agreement with state owned electricity firm PT Perusahaan Listrik Negara (PLN) on the price of gas supplies for the latter’s power plant in Muara Tawar,
Under the agreement, PLN will pay US$4.5 per million British thermal unit (MMBTU) for gas supplies pipelined by PGN from American firm ConocoPhillips’ Suban gas field of the Corridor block in Jambi.
The gas will be supplied by PGN to PLN’s power plant through the South Sumatra-West Java (SSWJ) pipeline.
“The leaders of PGN and PLN have reached an agreement on the price of gas supplies through the SSWJ pipeline to PGN’s final terminal in Muara Bekasi. From Muara Bekasi, the gas will be transported by PLN using their own pipeline,” PGN’s corporate secretary Widyatmoko Bapang told Petromindo.Com by phone on Tuesday, adding that the agreement had been reached after a tough negotiation.
The price agreement was valid for two years for a supply of 50 million cubic feet per day (MMCFD), he added.
Both state owned companies were at loggerheads over the price of the gas for more than a year. PGN insisted PLN should pay $5 per MMBTU for the gas and PLN said it could only afford the gas at the price of $3.5 per MMBTU.
PLN’s deputy director for generation and primary energy Tonny Agus Mulyantono confirmed that both firms had reached an agreement on the gas price but he said PLN had yet to reach a similar agreement with regards gas supplies from state owned oil and gas company PT Pertamina, local energy firm PT Medco Energi International and American firm Amerada Hess.
PLN expects 100 MMCFD of gas supplies from Pertamina’s Pagar Dewa field, 85 MMCFD from Hess’ Jambi Merang field and 50 MMCFD from Medco’s Singa field. All are located in
According to Tonny, PLN has yet to reach an agreement on fee to transport the gas from the three companies (Godang)