Update 1: Medco, Pertamina, Mitsubishi to sign LNG plant deal
Wednesday, January 17 2007 - 09:44 AM WIB
State owned oil and gas company PT Pertamina together with its partner, PT Medo Energi International, will sign a deal with Japanese firm Mitsubishi for the construction of an LNG plant in Central Sulawesi later this month.
Lukman Mahfoedz, president director of Medco E&P Indonesia, told reporters on Wednesday that under the deal, the Japanese firm would build the Senoro LNG plant with a capacity between 2-2.5 million tons per annum (MTPA) and natural gas supplies from Pertamina and Medco?s Senoro-Toilo and Donggi blocks. Both blocks have combined proven and certified gas reserves of 2.3TCF.
?Hopefully, the deal will be signed next week,? Lukman said.
Lukman said the companies are still looking for market for the LNG to be produced at the plant. However, Medco?s CEO Hilmi Panigoro said in November last year that the whole output of the LNG plant would be exported to Japan.
Meanwhile, Iin Arifin Takhyan, vice president director of Pertamina said the three companies had thus far agreed to set up a downstream unit to develop the LNG plant with Pertamina and Medco having 20 percent respectively and Mitsubishi 60 percent.
The three companies will place funds as capital in the new business unit and raise loans to develop the plant.
He estimated the construction cost of the LNG plant at US$600 million. (Godang)