PRESS RELEASE: First gas delivery from Natuna to Singapore
Wednesday, January 10 2001 - 04:00 AM WIB
A US$1.5 billion, two-year project to build one of the world's longest submarine pipelines came to completion when the West Natuna Transportation System delivered first gas into Singapore on January 3, 2000. The enormous project will send natural gas from Indonesia's West Natuna gas field to Singapore. It will mark the first Indonesia - Singapore gas sales and represent Indonesia's first international export of pipeline natural gas.
The gas pipeline network, known as the West Natuna Transportation System (WNTS), is the result of a successful close joint working partnership between Indonesia's Pertamina and three Production Sharing Contractors (PSC's) - Conoco Indonesia Inc. Ltd., Gulf Indonesia Resources Limited, and Premier Oil Natuna Sea Ltd. - which are called the West Natuna Gas Consortium.
The WNTS is a series of interconnecting pipelines that provide a means of gathering gas from 17 separate fields, operated by the three PSC's, in the West Natuna Sea and transport it to Singapore in support of the Gas Sales Agreement between Pertamina and SembCorp Gas, a Singapore gas marketing company owned by SembCorp Industries, Temasek and Tractebel.
The total length of the system is 656 kilometers which makes it one of the longest underwater pipeline systems in the world. The pipeline varies in diameter between 14 and 28 inches and has been designed with a life span of 50 years.
Announcing the forthcoming inauguration event to take place on January 15, 2001 in Singapore, Pertamina's president director Baihaki Hakim said that this investment is expected to generate significant foreign exchange earnings over its lifetime for Indonesia and is also expected to provide a significant boost to the economy.
"The inauguration of the pipeline next week will a most significant period for the Government of Indonesia and Pertamina. The project has demonstrated how many companies, especially Conoco, Gulf Indonesia and Premier Oil have worked together to bring this to a successful conclusion. Not only is the technology a major feat but also is the confidence of these business partners in successfully completing this project four months ahead of schedule," said Baihaki.
Under the gas sales agreement with SembCorp Gas, an average of 325 million standard cubic feet per day of natural gas will be available to Singapore for 22 years.
The system has capacity of 700 million standard cubic feet per day but could be increase to one million standard cubic feet per day with the addition of midstream compression. It has been designed in a flexible manner to allow gas to be introduced from other areas of the Natuna Sea and to facilitate additional delivery points in the future.
Baihaki stated, "the pipeline system has been constructed and will operate through a Joint Venture Agreement between Pertamina and the three PSC's: namely Conoco on behalf of Block B; Gulf Indonesia on behalf of Kakap Block; and Premier Oil on behalf of Block A."
The system has been funded initially by the three PSC groups and the costs will be recovered from sales revenue by agreement with Pertamina.
The natural gas will be used in Singapore by power generation companies, petrochemical and chemical companies, as well as various industrial users. The natural gas will eventually also be used in households.
Conoco Indonesia Inc. Ltd., is a wholly owned subsidiary of Conoco Inc, a major global integrated energy company active in more than 40 countries. Conoco is the operator of the West Natuna Transportation System and also operates the Block B PSC. Over 33 years, Conoco Indonesia Inc. Ltd., has acquired 14 additional blocks, which is stretched from North Sumatera to the east of Irian Jaya.
Gulf Indonesia Resources Ltd. headquartered in Jakarta, is an independent upstream company engaged in exploration, development and production of oil and natural gas in three cores areas: Sumatera, The Natuna Sea and East Java. Active in Indonesia since 1961, the company currently has interests representing 11 million gross acres in 13 onshore an offshore contract areas. Gulf Indonesia's common shares have traded publicly on the New York Stock Exchange under symbol "GRL" since 1997. the company is a 72 percent owned subsidiary of Gulf Canada Resources Limited, which is a Canadian based independent exploration and production company with primary operation in Western Canada, Indonesia, the Netherlands and Ecuador. Gulf Canada's shares are traded on the Toronto and New York Stock Exchange under the ticker symbol GOU.
Premier Oil strated business as the Caribbean Oil Company which was registered in the UK in 1934 to pursue oil and gas exploration and production in Trinidad. Since then the company has been active in the UK North Sea, Wytch Farm in the UK, Pakistan, The UK Continental Shelf and Myanmar. In 1996, Premier Oil acquired a majority interest in the Natuna Sea Block A PSC offshore Indonesia, comprising the Anoa oil field and gas reserves. It also acquired Discoveries Petroleum which added oil and gas reserves and access to further exploration acreage.
Contact: Siddick Nittikusumah, Pertamina, tel: +62-21-3816526, fax: +62-21-3454194. (*)