PLN says gas deal with CNOOC close

State electricity firm PLN said it was close to sign heads of agreement with CNOOC to supply natural gas from the latter?s Pabelokan field offshore West Java to Cilegon power plant, which is expected to commence operations in 2005.

?We hope to sign the HoA in one or two months, as we have basically agreed on the price of US$2.45 per MMBTU,? said PLN director Ali Herman Ibrahim on a sideline of parliamentary hearing in Jakarta Wednesday.

Ali said the volume is planned at 100 million cubic feet per day.

PLN is planning to build 750-MW combined cycle power plant in Cilegon next year to meet increasing electricity demand in western part of Java. PLN expected financing for the project to come from Mitsubishi Corp., but said that possibility was still open if CNOOC later decided to have some interest in the project. ?But at this stage, we are only talking to CNOOC regarding gas supply,? said Ali.

Earlier, PLN president Eddie Widiono said that CNOOC was also interested to have stake in Cilegon power plant project.

CNOOC, which operates South East Sumatra (SES) oil block where Pabelokan field is located, is Indonesia?s largest offshore oil producer. (alex/godang)