Pertamina, Medco to spend $1.9b on Donggi-Senoro LNG project

Indonesia’s state oil and gas company Pertamina will spend at least $1.387 billion and energy firm PT Medco Energy International $610.8 million on the Donggi-Senoro liquefied natural gas project in Sulawesi, officials said on Tuesday.

This came a day after Japan’s top trading house, Mitsubishi Corp , said it will invest in the $2.8 billion project via a joint venture, bolstering the confidence of investors who once feared the deal might not take off.

Pertamina’s business and risk management director Ferederick Siahaan said the company will spend $812 million for the LNG plant, $300 million for the development of the Senoro gas field, and $275 million for the development of the Matindok field.

The two gas fields will supply gas to the LNG plant, he told reporters at a gas conference.

PT Medco Energi Internasional project director Lukman Mahfoedz said the firm will spend $310.8 million for the LNG plant and $300 million to develop the Senoro gas fields, one of two fields that will supply natural gas to the LNG plant.

Medco earlier said in a statement it had signed a final investment decision for the 20 percent stake in the project through its PT Medco LNG Indonesia unit. The rest would be owned by Pertamina and Mitsubishi Corp.

The LNG project aims to produce 2 million tonnes of LNG a year from 2014.

Medco said the LNG will be delivered to Japan’s Chubu Electric Power Co and Kyushu Electric Power Co as well to South Korea’s Korea Gas Corp (KOGAS) .

Kyushu Electric, Japan’s fifth-biggest power firm, has agreed to buy 300,000 tonnes of LNG from Donggi-Senoro for about 13 years, while Chubu Electric, Japan’s third biggest power company, will purchase 1 million tonnes a year.

http://af.reuters.com/article/energyOilNews/idAFL3E7CP0A720110125

 

Category: ResourceAsia