PIM cancels plan to stop its operation

State owned fertilizer company PT Pupuk Iskandar Muda has cancelled its plan to stop is operation after ExxonMobil Oil finally agreed to resume its gas supply to the Aceh based fertilizer company, Kompas reported on Monday.

PT PIM's president director Hidayat Nyakman said in Jakarta on Sunday that ExxonMobil agreed to resume its gas supply after Vice President Jusuf Kalla issued a guarantee that the government would import a cargo of LNG to meet the export commitment of the Arun LNG plant.

Under the contract to be signed Monday evening, ExxonMobil would provide gas supply of about 60 million thermal units per day, Hidayat said, adding that with the gas supply, PT PIM would be able to operate for 50 days.

The good news came after PT PIM was in the process of halting its operation. On Thursday, ExxonMobil said it had no choices but to stop its gas supply beginning this week because the government had failed to issue a guarantee that it would import a cargo of LNG to meet part of the export commitment of the Arun LNG plant.

ExxonMobil said that government's guarantee is needed because the current production of the ExxonMobil's gas field is only enough to meet the export commitment of the Arun LNG plant. (*)