PLN hopes to sign gas sales agreement with Cepu block operator

State electricity company PT PLN said it is hoping to sign gas sales agreement soon with the owner of the Cepu block in East Java, PT Pertamina EP Cepu, Mobil Cepu Ltd and Cooperation Body (BKS) Cepu block owned by local government owned companies.

PLN is seeking the gas from the Cepu block to meet gas needs of its Tambak Lorok gas-fired power plant in Central Java.

Deputy Director for fuel and gas procurement of PLN, Soeryadi Mardjoeki told petromindo.com that pertamina has said that it is not ready to sign the deal as yet. PLN initially expected to sign the deal last August.

President Director of PLN, Nur Pamudji said PLN is still waiting for readiness of Pertamina-Exxon over the gas sales agreement. ?PLN wants to sign the gas sales deal immediately. Tambaklorok power plant needs gas,? he said.

He made the statement ahead of the groundbreaking of the Cepu block project facilities construction tomorrow. Cepu block to commence oil and gas production in 2015-2016.

Mobil Cepu Ltd. is the operator of the Cepu Block. Mobil Cepu Ltd. and Ampolex (Cepu) Pte. Ltd., both subsidiaries of Exxon Mobil Corporation, hold a 45 percent interest in the block, with Pertamina EP Cepu holding a 45 percent and the Cepu Block Cooperation Body (BKS) holding the remaining 10 percent.

Separately, the upstream oil and gas regulator BPMIGAS hopes the Cepu block production could replicate the success of Minas block owned by Chevron Pacific Indonesia in Duri, Riau, which managed to maintain constant production for over 20 years.

?We hope it is like Minas block, the Cepu block production will be constant for 20 years period,? the Head of BPMIGAS, Raden Priyono told Petromindo.com. (godang)