Indonesia-Singapore gas sales agreement firms up

Gulf Indonesia Resources Ltd. announced this week that Indonesia's state owned oil and gas company Pertamina and Gas Supply Pte. Ltd., an indirect, wholly owned subsidiary of Singapore Power, have initialed a detailed gas sales agreement and supporting schedules under which Pertamina will supply natural gas to Singapore. The gas sales agreement, together with all supporting agreements, is expected to be executed by Nov. 15, 2000, says Gulf Indonesia.


Gulf Indonesia Resources Ltd.�a 72%-owned subsidiary of Gulf Canada Resources Ltd., Calgary�announced this week that Indonesia's state owned oil and gas company Pertamina and Gas Supply Pte. Ltd., an indirect, wholly owned subsidiary of Singapore Power, have initialed a detailed gas sales agreement and supporting schedules under which Pertamina will supply natural gas to Singapore. The detailed agreement follows a preliminary agreement reached by the firms last year (OGJ, Oct. 4, 1999, p. 38).

The gas sales agreement, together with all supporting agreements, including the gas supply and transportation agreements and agreements between Gas Supply and its end users, is expected to be executed by Nov. 15, 2000, says Gulf Indonesia. This will be the second major gas agreement signed by Pertamina and a Singaporean company, according to the Canadian firm.

The gas to be sold by Pertamina will be supplied from three production-sharing contract areas in Sumatra. Two of the PSCs�Corridor Block and South Jambi B Block�are operated by Gulf Indonesia subsidiaries, while the third, Jabung Block, is operated by Santa Fe Snyder Corp.

Interests in Corridor are: Gulf Indonesia Resources, 54%; Talisman (Corridor) Ltd., 36%; and Pertamina, 10%. Interests in South Jambi B are: Gulf Indonesia Resources, 45%; TotalFina SA, 30%; and Pertamina, 25%. And interests in Jabung are: Santa Fe Snyder, 30%; Kerr-McGee Sumatra Ltd., 30%; Amerada Hess (Indonesia-Jabung) Ltd., 30%; and Pertamina, 10%.

The three PSCs will supply 150 MMscfd of gas beginning in 2003 and increasing to a peak rate of 350 MMscfd by 2009 for a total contract period of 20 years.

"The project is of strategic importance to Singapore, as it provides security of gas supply from South Sumatra, and is a priority for Indonesia, as it generates foreign exchange. All sides are working together towards finalizing all documents by mid-November," says Bill Fanagan, president and CEO of Gulf Indonesia.

Related to this supply agreement, a 500-km pipeline is planned from South Sumatra to Singapore via Indonesia's Batam Island.

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