PGN signs MoU with Kondur and Asahan Power

State-owned gas transmission and distribution company PT Perusahaan Gas Negara Tbk (PGN) signed on Thursday two memorandums of understanding (MoU) with Kondur Petroleum SA and Asahan Power Corporation Limited, respectively, on the purchase and sale of gas.

PGN said in a statement that it had agreed to buy entire gas reserves in Kondur-operated Malacca Strait production sharing contract on/offshore Riau Province and distribute the gas to the North Sumatra markets over 15-year period.

PGN said around 80 million cubic feet per day (MMCFD) of gas will be flowed starting 2007 and it will ramp-up to 120 MMCFD.

Asahan Power had agreed to buy between 50 MMCFD and 140 MMCFD to fuel its 220-megawatt power plant in North Sumatra, PGN said.

PGN is currently preparing the detail of the route and the environmental impact analysis of the 493-kilometer pipeline project to flow gas from gas receiving station in Duri, Riau to Medan, North Sumatra.

The pipeline is designed to have a capacity of up to 350 MMCFD.

PGN also has planned to speed up the project to enable it to go on stream in September 2007, instead of December 2007 as initially scheduled. (godang)