Pertamina is still awaiting the government`s approval for the POD."
Jakarta (ANTARA News) - PT Pertamina said East Natuna block in South China sea in the Riau Islands province is expected to turn out 1,000 million cubic feet per day (MMSCFD) of gas when it start operation in 2013.

M. Husen, upstream director of the state oil and gas company said the target has been included in its plan of development (POD) proposed to the government four months earlier.

"Pertamina is still awaiting the government`s approval for the POD," Husen said here on Monday.

Delay in the government giving the approval is over incentives demanded by the consortium holding the contract.

The proposed incentives are being studied by the finance ministry.

Husen said the production could be increased to 4,000 MMSCFD after the block has been fully operational.

The plan is the gas would be transported through pipelines to consumers in the country and abroad.

"One third of the production is for domestic consumption and two third for exports to neighboring countries," Husen said.

The project has been awarded to a consortium of four companies - Pertamina, ExxonMobil, Total EP, and PTT Thailand.

Pertamina as the operator has a 35 percent stake, Exxon also has a 35 percent participating interest with Total and PTT each as a 15 percent shareholder.

The consortium has submitted proposal for the development of the giant gas block, believed to hold one of the world`s largest gas reserves.

The project, which has been planned for over a decade, including the pipelines is estimated to cost US$24 billion.

Previously the government awarded the project to Exxon Mobil, but the US oil giant failed to carry out the project after its contract was more than once extended.

The government , therefore, cancelled the contract and gave it to Pertamina.

However, being not able to implement the project alone, Pertamina invited world`s oil giants to join.

Pertamina could not alone carry out the project as it needs not only huge investment but also high technology as the gas has high content of carbon dioxide that has to be separated.

The block is estimated to have a reserve of 222 trillion cubic feet of gas but 70 percent of which is CO2 with commercial gas reserve making up only 46 trillion cubic feet.

Editor: Priyambodo RH
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