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State oil and gas company Pertamina and a number of Japanese
gas companies have agreed on the price of Indonesian liquefied natural
gas (LNG) supplies to Japan until 2011, an official says.
The agreement was reached in negotiations between Pertamina and six
Japanese gas companies based in western Japan.
Speaking after attending a function to mark Pertamina*s 50th
anniversary in Japan on Friday, visiting Energy and Mineral Recourses
Minister Purnomo Yusgiantoro said as quoted by Antara news agency, "The
negotiations have been concluded successfully. We have also agreed on
the price. We got a price that is still good for Indonesia."
Pertamina president director Ari Soemarsono said the talks were in
principle concluded Thursday and only documents on technical matters
still needed to be wrapped up.
But both the energy minister and the Pertamina president director
declined to name the LNG price, saying only it was profitable for
Indonesia.
Earlier, Pertamina deputy president director Iin Arifin Takhyan engaged
in negotiations with six Japanese gas companies, among others Osaka Gas
and Toho Gas in Osaka.
The parties also discussed compensation for LNG shipments still owed by
Indonesia through adjustments in the price.
The arrears in the LNG supplies to Japan comprised 72 cargoes.
Purnomo had earlier said the LNG price being negotiated was more than
US$10 per mmbtu (million British thermal units) while the LNG price in
the world market now ranged between $9 and $10 per mmbtu.
The minister said Indonesia and Japan had a long-term LNG contract
valid for 10 years under which Indonesia was supplying Japan with 3
million tons per year during the first five years and 2 million tons
per year during the last five years.
Every year Indonesia and Japan renegotiate the LNG price to adjust it
to world market prices.
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