Australia's Santos doubles gas supply in Indonesia http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-10-19T033109Z_01_JAK200928_RTRIDST_0_ENERGY-INDONESIA-SANTOS.XML&rpc=66&type=qcna
Wed Oct 18, 2006
JAKARTA, Oct 19 (Reuters) - Australian oil and gas producer Santos Ltd. (STO.AX: Quote, Profile, Research) has doubled its gas supply to industrial customers in Indonesia's East Java province from its Madura block via a pipeline, a company official said on Thursday.
The gas is being distributed by a state-run gas distribution company, PT Perusahaan Gas Negara (PGN) (PGAS.JK: Quote, Profile, Research). Santos Indonesia spokesman Drajat Panjawi said supply to PGN had reached 80 million cubic feet per day from 40 million cubic feet per day earlier this month.
"We will reach a peak level of 110 million cubic feet per day in not too long a time," he told Reuters.
Santos has said it planned to supply gas at a peak rate up to 110 million cubic feet per day for at least six years.
In 2005, Santos signed a deal with PGN, worth $550 million, to supply gas from the Maleo offshore field in Madura block in Indonesia's East Java region for a period of eight to 12 years.
PGN's corporate secretary Widyatmiko Bapang has said the contract with Santos could save Indonesia from burning 6 million kilolitres (38 million barrels) of diesel over that period.
PGN was also currently being supplied by local company PT Energi Mega Persada (ENRG.JK: Quote, Profile, Research), but the volume has been declining.
Santos has 67.5 percent of the stake in Madura block and its other partners are Malaysia's Petronas [PETR.UL] with a 22.5 percent stake and regional local firm with 10 percent.
Santos has lately sought to reduce its reliance on production from the ageing Cooper Basin in outback Australia, focusing more closely on Indonesia.
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