Indonesian gas glitch could be solved by May

Maintenance of gasfields results in supply shortfall here
Ronnie Lim, Business Times 19 Mar 10;

(SINGAPORE) Singapore's latest Indonesian gas glitch - involving a shortfall in supplies from West Natuna since last month - is expected to be resolved around May, BT understands from sources. It is due to maintenance of the gasfields there by the operator.

It follows close on the heels of last year's problems of 'buckling' or warping along certain points of a 23-km stretch of the gas pipeline transporting Sumatran gas imported by Gas Supply Pte Ltd into Singapore.

This also saw 'some reduction, although no stoppage' of gas supplies during the six to eight months of repairs until Q3 2009, the sources add.

The two pipelines together bring in a contracted 690 million standard cubic feet of gas daily (mscfd) from Indonesia, or about 72 per cent of Singapore's total piped gas imports of 955 mscfd, with the remainder coming from Malaysia.

The latest Indonesian gas supply hiccup involves importer Sembcorp Gas which had contracted to bring in 325-340 mscfd from the West Natuna field.

The field operator, understood to be ConocoPhillips, is currently carrying out routine maintenance work at the field, and there has consequently been some supply shortfall to Singapore - said to be 'small' by sources - as a result of switching wells.

'The operator is understood to be deploying another production platform to address the issue, with the work expected to be completed by May,' one source said.

The latest gas issue first surfaced when BT reported earlier this month that the generating companies here - which usually run as much as 80 per cent natural gas to power their more-efficient gas turbines - had recently resorted to using more fuel oil instead to run steam turbines.

This saw their fuel oil usage rising to 27-30 per cent of their total fuel mix, compared to just about 20 per cent previously.

SembGas on its website said that it supplies its Natuna gas not only to gencos like PowerSeraya and Tuas Power but also petrochemical customers including ExxonMobil and Ellba Eastern. Some of the petrochemical plants also run their own in-house gas-fired cogeneration plants to supply not just power, but also other utilities like steam and cooling water.

Separately, there was an isolated incident of traces of mercury, a toxic metal, found in Natuna gas last June. While the low mercury levels detected posed no real danger to public health, the regulator Energy Market Authority is getting a consultant to look at identifying measures to mitigate this.

Mercury, which is found organically-bound in natural gas from the gasfield, can potentially damage plant and equipment, or affect workers exposed to it during maintenance operations.