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Indonesia’s Donggi-Senoro LNG project to start up in mid-2015

Indonesia’s Donggi-Senoro liquefied natural gas (LNG) project will commence production in mid-2015, a spokeswoman for the project said, around three months later than a previous target provided by one of its major shareholders.

Indonesia is currently the world’s fourth-biggest exporter of LNG. By 2020, however, Southeast Asia’s largest economy is expected to import up to 3.5 million tonnes of LNG per year as it increasingly turns to gas to generate power for industry and to fuel trains and trucks.

The $2.8 billion Donggi-Senoro is one of several major gas infrastructure projects that the country hopes will meet mushrooming energy demands at home and around the region.

LNG projects often run behind schedule and over budget. Donggi-Senoro, Indonesia’s fourth LNG project, was originally expected to come online in 2014, but the target was later pushed back to March 2015.

“Our position is still on schedule in mid-2015 for the first LNG shipment,” Donggi-Senoro Internal and Public Communication Supervisor Doty Damayanti told Reuters on Wednesday, declining to comment on a possible delay from the March date.

Shareholders in the 2 million-tonne-per-year (MTPA) Donggi-Senoro project include Mitsubishi Corporation, South Korea’s Kogas, Indonesia’s Medco Energi Internasional and Indonesia’s state energy firm Pertamina.

Donggi-Senoro expects to begin receiving 250 million standard cubic feet a day (MMscfd) of gas committed from the Pertamina Medco Tomori Sulawesi Joint Operating Body (JOB PMTS) by mid-year 2015, Damayanti said, the main feed supply for the plant.

Delivery of part of an additional 85 MMscfd committed from the Matindok Gas Development Project (MGDP) is expected to begin in December 2015, with the remainder expected to come on stream in March 2016, bringing the total gas supplied to Donggi-Senoro to 335 MMscfd.

Donggi-Senoro has contracts to supply 1 MTPA of LNG to Chubu Electric Power Co Inc, 300,000 tonnes per year to Kyushu Electric Power Co Inc and 700,000 tonnes per year to Kogas.

“For now we are focusing on finalising the projects we have at the moment to supply 2 million tonnes per year to the committed buyers we have. In future if the upstream partners make new (gas) discoveries, we will have to balance feasibility and the project economics,” Damayanti said in response to a question regarding expansion plans for the project based in Central Sulawesi.

According to PT Donggi-Senoro LNG Chief Executive Gusrizal, the plant is currently in the utility and safety system commissioning phase. It will allow “the marginal gas reserve in Sulawesi to be monetized”, he added.

Source: Reuters.com, Oct 8, 2014

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