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The sales of some liquefied natural gas (LNG) from Tangguh gas field, Papua, to Sempra, United States, can be transferred to another buyer.

The transfer will be carried out if the LNG sales price is higher than that of Sempra’s.

Eddy Purwanto, Deputy of Marketing and Finance at the Upstream Oil and Natural Gas Business Executing Body, emphasized that the gas transfer from Sempra can be done to any other buyer.

“As long as the sales price is better than Sempra’s,” he told Tempo last weekend.

Based on information received by Tempo, gas sold to Sempra will be transferred to a buyer from Japan.
The reason is, Sempra's LNG facility was built quicker than first planned, in mid 2008.

Sempra signed Tangguh's 20 year gas purchase contract for a volume of 3.7 million tons at the price of US$5.94 per mmBtu.

Eddy went on to say, that the transfer of gas that was bought by Sempra to another buyer has compensations.

“Sempra will obtain certain compensations,” he said.

However, when asked whether the compensation was a penalty that the government must pay, Eddy did not give any answer.

Kurtubi, an oil and gas observer, said that the Tangguh gas sales price, which is under the average gas sales price from Badak refinery in East Kalimantan, will not result in any revenues for the state.

This is because, he said, with investment totaling US$6.5 million and the revenues totaling only US$8.5 billion for 25 years, all revenues are only sufficient to cover the investment costs.

“So what does the state obtain?” he said to Tempo.

Currently, the gas sales contract amounts to 2.6 million tons to Fujian, China for 25 years, with an average price of US$3.35 per mmBtu.

The contract with SK Power Korea amounts to 0.55 million tons for 20 years with US$3.5 per mmBtu sales price.

The contract with Posco Korea 0.55 million tons for 20 years with US$3.36 per mmBtu sales price and Sempra (West Coast, US) 3.7 million tons for 20 years with US$5.94 per mmBtu sales price.

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