PT Pertamina agreed to sell 2 million metric tons a year of liquefied natural gas from a Mitsubishi Corp.-led venture building Indonesia's fourth LNG plant to two Japanese companies, a company official said Thursday.
Pertamina, which is leading the marketing for the Senoro LNG plant in Sulawesi, has finalized the sale and prices for 1 million tons each of the fuel to a Jgas utility and a trading house, Iin Arifin Takhyan, vice president of Pertamina, said in an interview, declining to name the buyers. The final investment decision for the venture, which was scheduled for this year, will now be early next year, he said.
The project will help Japan secure energy supplies after Indonesia cuts shipments to this nation by 75 percent following the expiration of current contracts by March 2011. Indonesia may produce about 20 million tons of LNG next year, unchanged from this year, Takhyan said. That excludes output from the country's new LNG plant in Tangguh.
"We have a good price for the LNG," he said. "There are no floor and caps on LNG prices."
Pertamina has linked the price of the fuel to the Japan Crude Cocktail, which is calculated by the Finance Ministry, and is the average cost of crude oil imports by Japan.
Indonesia "has not yet approved the Senoro LNG sale price," he said.
The trading house has rights to divert the LNG to other buyers on the spot market, Takhyan said. PT Donggi Senoro LNG, 51 percent owned by Mitsubishi, may start production in 2011, he said. Medco owns 20 percent of the plant and Pertamina holds 29 percent.
The $1.4 billion LNG plant will be fed by gas from the Senoro field and the Pertamina-owned Matindok area, both in Sulawesi.