Indonesia has finally agreed to continue shipping LNG to Japan, but the quantity and price is “still under processing”, according to sources close to national oil company Pertamina.
The two countries only came to an agreement after intense and sometimes antagonistic negotiations, with Jakarta wanting to conserve supplies for domestic consumption and Tokyo desperate to secure supplies.
Pertamina sources contradict reports in the Jakarta Post that 5M tonnes of shipments would be exported to Japan annually after 2010. However, Fairplay understands that most of the shipments under a post-2010 agreement will originate from a new plant, to be opened at Dongjji. An unspecified quantity will come from the Senoro facility where Japanese company Mitsubishi has a 51% stake.
The new agreement falls within the ambit of the Economic Partnership Agreement, formalised during this week’s visit to Indonesia by Japan’s Prime Minister Shinzo Abe. Tokyo had demanded Indonesia honour its LNG obligations when an agreement signed 20 years ago expires in 2010. Jakarta had shipped 12M tonnes a year under the old agreement; before the ‘crisis’ of depleting gas resources and meeting domestic Indonesian energy needs began to test commercial ties between the two countries.
The two countries only came to an agreement after intense and sometimes antagonistic negotiations, with Jakarta wanting to conserve supplies for domestic consumption and Tokyo desperate to secure supplies.
Pertamina sources contradict reports in the Jakarta Post that 5M tonnes of shipments would be exported to Japan annually after 2010. However, Fairplay understands that most of the shipments under a post-2010 agreement will originate from a new plant, to be opened at Dongjji. An unspecified quantity will come from the Senoro facility where Japanese company Mitsubishi has a 51% stake.
The new agreement falls within the ambit of the Economic Partnership Agreement, formalised during this week’s visit to Indonesia by Japan’s Prime Minister Shinzo Abe. Tokyo had demanded Indonesia honour its LNG obligations when an agreement signed 20 years ago expires in 2010. Jakarta had shipped 12M tonnes a year under the old agreement; before the ‘crisis’ of depleting gas resources and meeting domestic Indonesian energy needs began to test commercial ties between the two countries.