Japan's Sumitomo and Mitsui have signed an agreement with Indonesia's BPMigas to develop gas projects from its marginal fields, the Southeast Asian country's oil and gas watchdog said on Tuesday.
State-run Japan Bank for International Cooperation (JBIC) also said it had agreed with BPMigas to cooperate in fostering development of natural gas projects, in which the bank will finance the gas projects prepared by the two firms.
"The two companies are willing to develop integrated gas projects, meaning that they are willing to develop upstream to downstream gas projects," Gde Pradnyana, BPMigas's spokesman told reporters.
He added that Sumitomo and Mitsui would develop marginal fields and the output would be used for domestic demand.
BPMigas said the two companies would soon start with the feasibility study to find out which fields have the potential to be developed.
JBIC said the deal would help secure stable energy supplies to Japan and create natural gas-related business opportunities for Japanese firms.
The cooperation agreement would benefit both Indonesia, whose domestic gas demand is increasing, and Japan, which is highly dependent on LNG supply from Indonesia, said Nobuyuki Higashi, JBIC's head for Asia and Oceania Finance Department.
Indonesia, the third-biggest exporter of liquefied natural gas (LNG) to Japan, exported 12.8 million tonnes to Japan, the world's biggest LNG importer, last year.
"The Japanese companies want to develop the marginal fields so Indonesia's total output will increase and all stakeholders will enjoy the benefit," Higashi added. Source: Reuters
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