11th Dec 2007 07:01
Premier Oil PLC11 December 2007 PREMIER OIL plc ("Premier") Further Indonesia Gas Sales Agreements Signed Natuna Sea Block A - signature of Heads of Agreements Premier is pleased to announce the signature of Heads of Agreements with PTPerusahaan Listrik Negara (PLN) and PT Universal Batam Energy (UBE) for the saleof gas for use in power generation in Batam, from the Gajah Baru, Naga andIguana fields in Natuna Sea Block A. Detailed negotiations will now commence to conclude Gas Sales and PurchaseAgreements (GSPA) with both PLN and UBE. The agreement with PLN will be a "life of field" contract with plateau gasdeliveries at a maximum rate of 20 billion British thermal units ("BBtu") perday commencing in 2010, with an option for PLN to increase deliveries to amaximum rate of 35 BBtu per day. The agreement with UBE will be a "life of field" contract with plateau gasdeliveries a maximum rate of 20 BBtu per day commencing in 2010. In November, Premier announced the signature of a Heads of Agreement withSembcorp Gas Pte Ltd for a "life of field" contract with plateau gas deliveriesinto the Jurong petrochemical complex in Singapore at a daily contract quantityof 90 BBtu per day commencing in 2010. Premier is the operator of Natuna Sea Block A with a 28.67% interest and NatunaSea Block A is a 36.9% owner of the WNTS pipeline. Premier also holds an 18.75%interest in the Kakap field. Premier's partners in Natuna Sea Block A areKufpec (33.33%), Hess (23%) and Petronas (15%). North Sumatra Block A - signature of Gas Sales and Purchase Agreement Further to Premier's announcement on 2nd November 2007, we are pleased toannounce that operator PT Medco E&P Malaka (MEDCO) and PT Pupuk Iskandar Muda(PIM) signed a GSPA in Jakarta, on Monday, December 10th, 2007. The GSPA willgovern the sale of gas from the Alur Rambong, Julu Rayeu, and Alur Siwah fieldsin North Sumatra Block A to the PIM fertilizer plants on the northern Acehcoast. Gas will be delivered at a plateau rate of 110 BBtu per day. MEDCO and PIM haveagreed a fixed floor price of US$5.00 per MMBtu for gas with an additionalupside profit share element which is related to urea prices. The contract allowsfor minimum sales of 223 Tbtu with ultimate sales of over 400 Tbtu. Gas will be delivered through a new 20 km pipeline to a delivery point at anexisting pipeline which will transport the gas to the PIM plant, approximately70km away. Development activities are on-going with a view to delivering firstgas in the 4th Qtr 2010. MEDCO and partners are currently seeking approval fromIndonesian regulator BPMIGAS for the Block A Plan of Development and anextension of the Block A Production Sharing Contract to 2031. Premier Oil holds a 41.66% participating interest in North Sumatra Block A. Theoperator MEDCO holds a 41.67% participating interest, with Japex holding theremaining interest. Simon Lockett, Premier's Chief Executive, commented: "We are pleased to announce the signature of Heads of Agreements for domesticgas sales into Batam and the completion of the Gas Sales and Purchase Agreementfor North Sumatra Block A. These agreements commercialise discoveredundeveloped gas reserves in our Indonesian acreage, which will materiallycontribute to achieving our production target of 50,000 boepd in 2010." 11 December 2007ENQUIRIESPremier Oil plc Tel: 020 7730 1111Simon LockettTony Durrant Pelham PRJames Henderson Tel: 020 7743 6673Gavin Davis Tel: 020 7743 6677 Notes to editors Since January 2001, Premier has supplied gas from Natuna Sea Block A fordomestic power generation through the WNTS pipeline into Singapore. At present,gas production from Natuna Sea Block A is around 130 BBtu per day. North Sumatra Block A covers an area of 1803 square kilometers, and is locatedonshore in Eastern Aceh province. On 2nd November 2007, Premier announced thesigning of a Heads of Agreement for a gas sale with PT Pupuk Iskandar Muda("PIM"), a state owned urea fertiliser company of the Republic of Indonesia, tosupply 110 BBtu per day from North Sumatra Block A for the period of about sevenyears starting from 2010 to PIM fertiliser plants. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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