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Indonesia-Malaysia trade talks

JAKARTA: Indonesia is in talks with Malaysia's state oil and gas company over the possible sale of gas from the huge Natuna field in the South China Sea, a report said on Monday.

The president of Indonesia's state-owned oil and gas firm Pertamina, Martiono Hadianto, said negotiations with Petroliam Nasional Bhd (Petronas) were still in the early stages and the volume of gas involved was yet to be discussed, the Jakarta Post daily said.

The talks started in April last year, when he was on a visit to Malaysia, Hadianto said.

Mines and Energy Ministry director general for oil and gas Rachmat Sudibyo was separately quoted as saying the West Natuna field was close to a Malaysian-operated gas field, so that Indonesia would only need to connect the two countries' gas pipe network.

Sudibyo said the connection would require only some 40 kilometres (25 miles) of new pipeline.

He said he expected the Pertamina-Petronas negotiations would be completed by next month and the supply project would start at the end of 2001.

Pertamina, Sudibyo said, was hoping Petronas' gas purchase price would be around the same as that offered by Singapore, the first country to buy gas from the West Natuna gas field. But he gave no figure.

Under a contract to begin in July 2001, the West Natuna Gas Consortium would supply Sembawang Gas of Singapore 325 million cubic feet of natural gas per day. AFP