PLN rejects additional term in gas swap agreement

By Edi Junaedi

State owned electricity company said that it had rejected an additional clause in a gas swap agreement on gas supply from Gajah Baru field as required by Gas Supply Pte Ltd, which provides gas supply to Singapore, the company?s executive said.

M. Suryadi Mardjoeki, the head of gas division at PLN said that as the consequence of the refusal, PLN would not be able to get gas supply of 40 million standard cubic feet (mmscfd) from the Gajah Baru field on Jan, 25 as initially scheduled.

PLN opposed the additional term because it required PLN to pay compensation to SGPL?s customers in Singapore if there is supply disruption as the result of the swap agreement. He said that the compensation that should be paid could amount to US$1 million.

Mardjoeki said that he had been summoned by oil and gas upstream authority BPMIGAS on Monday to talk about the gas swap agreement. He said that BPMIGAS would soon send a letter to PLN?s board of executives to ask the board to approve the clause so that the problem could be settled.

Editing by Benget Besalicto Tnb.