Producers and buyers sign US$1.5 billion gas deals

Several natural gas buyers and producers signed on Monday three gas sales and purchase agreements worth US$1.5 billion.

The Indonesian unit of British firm BP PLC agreed to supply the fuel from its Offshore Northwest Java to state owned fertilizer firm PT Pupuk Kujang for 11 years starting in 2007. BP will supply 60 billion British thermal unit per day (BBTU) or a total of 1.37 trillion British thermal unit (TBTU) throughout the period to the fertilizer firm, oil and gas regulatory body BP Migas said in a press release issued during the signing ceremony.

BP will sell the gas at the flat price of $3.63 per million British thermal unit (MMBTU) throughout the contract period.

Indonesian firm Medco E&P Indonesia signed an agreement to sell natural gas from its South Sumatra field to gas trader PT Mitra Energi Buana which will resell it to PT Tanjung Enim Lestari Pulp & Paper. Medco will supply Mitra Energi with a total of 6 trillion British thermal unit of natural gas (TBTU) throughout the contract period of 6.5 years starting next year. The gas is priced at an average of $2.99 per MMBTU.

The third contract was signed by JOB Pertamina-Amerada Hess Jambi Merangin and state electricity firm PT PLN that allows the former to supply the latter with a total of 323.66 TBTU throughout the contract period of 12 years or 80 BBTU per day starting in 2008. The gas that is priced at an average of $2.97 per MMBTU will be used by PLN to generate power at its Payo Selincah power plant in Jambi, according to BP Migas. (Alex)