PT Pertamina, Indonesia’s state oil company, and PT Perusahaan Listrik Negara plan to build eight small-size liquefied natural gas receiving terminals with a combined capacity of 1.4 million metric tons a year.

The facilities aim to guarantee supplies of the cleaner- burning fuel to Listrik Negara’s power plants in eastern Indonesia, Daniel Purba, vice president of engineering and gas projects at Pertamina, told reporters today.

Indonesia, Southeast Asia’s biggest economy and the world’s third-largest LNG exporter, is increasing domestic use of gas to make up for falling crude output from aging fields, which led to the country withdrawing from the Organization of Petroleum Exporting Countries in 2008.

“Four receiving terminals are expected to be operational at end of next year, with the rest in 2013 and 2015,” Purba said after the signing of an accord on the project in Jakarta today. He declined to give investment and financing details.

The receiving terminals will be built in eastern Indonesia including in Balikpapan, East Kalimantan province, Pomala in Southeast Sulawesi and in Bali, according to a statement from Pertamina.

“Pertamina and Listrik Negara will form a venture to operate the terminals,” Purba said. “We’re still evaluating the source of LNG, but most likely they will come from our plant in Bontang in East Kalimantan.”

The terminal in Pomala will help Listrik secure fuel to power a ferronickel plant owned by PT Aneka Tambang, said Dahlan Iskan, president director of the Indonesian state utility.

LNG is natural gas chilled to liquid form for transportation by ships to places not connected by pipelines. Qatar and Malaysia are the world’s largest and second-biggest exporters of the fuel, respectively.

News Source : Bloomberg

photo source : gasdetection.com

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