PLN seeks $10 per MMBTU price for Sengkang LNG

State electricity firm PT PLN (Persero) said it would propose price of around US$10 per MMBTU for LNG produced from Sengkang LNG plant, South Sulawesi.

PLN?s Gas and Fuel Division Head M. Suryadi Mardjoeki said PLN was seeking to buy the entire LNG production from the project?s first phase of 0.5 million tonnes per annum or about 70 MMCFD as stated on the project?s PoD approved by upstream oil, gas authority BPMIGAS.

Mardjoeki said LNG from Sengkang will be used to fuel its proposed power plants in Hamahera, North Maluku and in Pomalaa, Southeast Sulawesi . He added that the Sengkang LNG project is expected to start supplying the fuel to PLN by the end of 2013.

PLN and state oil, gas company PT Pertamina (Persero) has earlier agreed to set up an LNG shipping JV that will tansport LNG to eight LNG terminals that would be built across eastern Indonesia. The JV is expected to be signed in September this year.

Australia-listed Energy World Corporation is planning to build an LNG plant in Sengkang with initial output of 0.5 MTPA, ramping up to 2 MTPA using gas from Sengkang PSC, where the company?s subsidiary the operator and 100 percent interest holder. The LNG plant will be developed using downstream scheme, meaning that development cost of the plant will not be subject to cost recovery. (giok)