
Beijing - Exxon Mobil Corp agreed to sell natural gas to Indonesian fertilizer plants in Aceh province that are threatened with closure to help rebuild the economy after the area was devastated by last week's earthquake and tsunamis, the oil and gas regulator said.
Exxon, the world's largest publicly traded oil company, agreed to a government request to boost supplies to the fertilizer plants at the expense of a nearby liquefied natural gas plant partly owned by the US company, said Rachmat Sudibyo, chairman of the regulator, BPMigas. Exxon's spokeswoman Deva Rachman could not be reached for comment.
The agreement "will help revive the economy devastated by the recent tragedy," Rachmat said yesterday.
A magnitude-9 earthquake off the coast of Sumatra and subsequent tsunamis may have killed 100,000 people in coastal regions of Indonesia. The giant waves killed at least 30,000 people in Aceh's capital, Banda Aceh, the government said in a statement in Jakarta yesterday.
Exxon's supply to the PT Arun NGL gas liquefaction plant in Aceh has declined in recent years because of depleting reserves in the company's fields.
Indonesia's other gas liquefaction plant, PT Badak NGL in Bontang, East Kalimantan, will fulfill some of the export contracts that Arun will no longer be able to honour, said Djoko Harsono, head of the marketing division at BPMigas.
"Arun and Badak have this transfer commitment so Arun can supply gas to fertilizer plants without having to cut LNG exports to buyers," Djoko said.
Badak, the world's largest LNG plant in operation, will deliver as many as nine cargoes to Arun's buyers in Japan, South Korea and Taiwan next year, he said.
Exxon, which operates gas fields in the northwestern province of Aceh, signed contracts on December 31 to supply 120 million cubic feet of natural gas a day to fertilizer makers PT Pupuk Iskandar Muda I and II in Aceh at US$2.30 per million British thermal units.
PIN//China Daily
News ID 41652
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