Thai PTTEP may join venture with operators of Natuna gas field: Report
Saturday, April 8 2006 - 02:26 AM WIB
The field is currently being developed by ExxonMobil of the United States and Pertamina, an Indonesian state enterprise. The exploration stage has been completed and production is awaiting confirmed orders from the foreign buyers.
PTTEP president Maroot Mrigadat said the Natuna field had gas reserves of 40-50 trillion cubic feet, one of the largest gas deposits in the region.
Thailand could become a key gas buyer from Natuna since it is only 1,700 kilometers from the centre of the field.
The Natuna operators have approached PTTEP about taking an equity partnership in the field given the Thai company's policy to secure energy reserves to meet rising domestic demand.
The governments of Thailand and Indonesia originally agreed in 1997 to produce and market gas from Natuna. PTT Plc, the parent company of PTTEP, was invited to invest in the gas pipeline to connect the field with the pipeline network in the Gulf of Thailand.
However, oil prices of US$20-22 per barrel at the time were not considered viable for the pipeline investment while gas quality in the field was not seen acceptable at that time. The co-operation agreement subsequently lapsed.
According to Maroot, current oil prices of US$55 and more per barrel make a pipeline investment viable.
However, PTTEP still considers Natuna an alternative field, not a core site for petroleum production due to the excessive carbon dioxide content in the gas, higher than that found in the Gulf of Thailand.
If PTTEP decided to invest in Natuna, he said, substantial funds would be needed to eradicate carbon dioxide to improve the quality of the gas. (*)