PIM to get gas through LNG swap

Aceh fertilizer firm PT. Pupuk Isakandar Muda (PIM) will get gas supply of 60 MMCFD for 180 days, or equals to 3 LNG cargoes, starting mid-April after East Kalimantan fertilizer firm PT. Pupuk Kaltim (PKT) agrees to cut its gas supply from East Kalimantan producers through supply swap mechanism, BPMIGAS Chairman Kardaya Warnika said.

Under the swap mechanism, said Kardaya, ExxonMobil will divert 60 MMCFD of gas supply that should have been supplied to Arun LNG plant to PIM, causing Arun LNG production to drop by three cargoes. East Kalimantan gas producers will cut PKT?s gas supply by 60 MMCFD and would turn the gas into 3 cargoes of LNG, which will be send to Arun?s customers.

Kardaya did not say what would happen to PIM after the 180-day period passed.

PIM has been screaming for gas supply after its contract with Exxon Mobil expired and the latter had no additional gas to spare to extend contract. PIM is in talks with producers such as ConocoPhillips and Eni SpA to buy gas from their respective fields, which are located near to PIM. However, the eralization of gas supply from the two gas producers would take years as the two blocks, namely Block A and Krueng Mane , had yet been developed. (godang)