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| LNG TANKER |
Jakarta. State energy firm Pertamina announced
on Wednesday it had secured a deal to import liquefied natural gas to
service domestic shortfall, even as Indonesia maintains its position as
the world’s third-largest exporter of the commodity.
According to a new contract with Cheniere Energy, the US company will
supply Pertamina with a further 760,000 metric tons of LNG per year,
bringing the total annual volume imported to 1.52 million metric tons of
LNG.
Under the 20-year contract, the first LNG import will be delivered in
2019, and will be charged in reference to the price at Henry Hub, a
natural gas hub in Lousiana.
The previous agreement between Pertamina and Cheniere, signed last
December, is also a 20-year contract, with the first delivery scheduled
for 2018.
Due to the arguably shortsighted signing of unfavorable 15-to-25-year
forward contracts last decade, Indonesia is contracted to export for a
song much of the LNG produced at major fields such as Tangguh to Korea,
Japan and China.
As a result, Salis S Aprilian, Pertamina’s senior vice president for
gas and power, said in May that Indonesia may have to import as much as 3
million metric tons of LNG annually by 2025 in order to cope with
domestic demand.
Up to 30 percent of LNG from East Kalimantan’s Mahakam Block is sold
into the domestic market, but production at the aging project is falling
as operators Total and Inpex hold off on investment, waiting to see
whether they will be granted an extension after their contract ends in
2017.
Hari Karyuliarto, Pertamina’s director for gas, said that the deal
was part of Pertamina’s commitment to secure LNG supplies. “This deal
was driven by rising demand in past couple of years, especially in
electricity and industry.”
By Tito Summa Siahaan on 09:00 pm Jul 02, 2014
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