PT Pertamina and PT Perusahaan Listrik Negara signed an establishment of Joint Venture in the gas supply and transportation business, to supply gas to Perusahaan Listrik Negara (PLN) in eastern Indonesia.
Indonesia is investing in natural gas infrastructure as its crude oil output has been diminishing in recent year, leading Indonesia to withdraw from OPEC in 2008. The joint venture in eastern Indonesia is expected to contribute to cost saving on electricity generation and reduce the government subsidy to anticipated rising fuel prices.
President Director of PT Pertamina, Karen Agustiawan, said, “I hope this is also a guarantee of security of gas supply in the PLN operation areas in eastern Indonesia and as part of more integrated gas business for the benefit of PLN."
The partnership plan to build 8 mini LNG terminals, in Balikpapan, East Kalimantan province, Pomala in Southeast Sulawesi and in Bali, which will be operational by 2015. The plants are expected to have a combined capacity of 1.4 million tonnes per year of natural gas.
Pertamina and PLN will collaborate on the projects, so it will secure the off taker and the volume that will give the most efficient transportation and re-gasification cost.
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