PGN says Singa gas would be sold to Chevron

IDX-listed state gas distribution firm PGN said on Thursday it was in talks to sell gas from Singa field in Lematang PSC onshore South Sumatra to Chevron?s steamflood facilities in Duri, Riau starting March this year.

President Director Hendi P Santoso said gas from the field, which volume would reach 50 MMCFD, will be supplied to Chevron for three years.

?We?re in price negotiation now facilitated by (upstream oil, gas authority) BPMIGAS,? he said, adding that PGN wanted price on par with the price of gas supplied by US oil, gas firm ConocoPhillips from Corridor Block onshore South Sumatra.

PGN is the offtaker of Singa gas for three years. The field is expected to start production this March.

Gas from Singa originally would be supplied to PLN?s Muara Tawar power plant in West Java using PGN?s pipeline, but lack of compressor make transmission impossible.

Hendi said PGN would add compressor at its pipeline to enable gas from Singa to be supplied to Muara Tawar after Chevron?s contract expired.

Chevron is scrambling for gas supply to run its steamflood facilities to keep pumping crude from its aging fields. Currently all of the steamflood gas supply is coming from ConocoPhillips-operated Corridor block. The current level of gas supply from Corridor block is insufficient for the streamflood to run optimally.(bernard)