Argus reported that Japan's Mitsubishi is buying a 20% stake in the Senoro Toili natural gas field in Indonesia for USD 260 million. The field will supply the planned 2 million tonnes per annum Donggi Senoro LNG project, which is 45% owned by the Japanese firm.

Mitsubishi said that it has bought the Tomoro E&P unit of Indonesian independent Medco Energi, giving it a 20% stake in the field. Medco's stake in the Senoro field has fallen to 30%, with the remaining 50% owned by Indonesia's state owned Pertamina.

The Senoro field in central Sulawesi province is due to start producing gas in 2014, with around 250 million cubic feet per day supplied to DSLNG. Gas from the Senoro field will support 1.5 million tonnes per annum of LNG production, around 75% of the amount needed for exports to Japan and South Korea, which are scheduled to start by the second half of 2014. A final investment decision on the Senoro field is due later this year. The field already produces around 1,900 barrels a day of oil.

Around 25% to 30% of the Senoro field's output will be supplied to domestic users. Indonesia had mulled banning exports in order to guarantee supply to the domestic market, where government capped prices had raised doubts about the viability of the project. Jakarta gave the green light to exports last year, paving the way for a FID on DSLNG last week.

Mitsubishi said its acquisition of a stake in the Senoro field will create synergies across the upstream and downstream parts of the Donggi Senoro project. DSLNG has been split into separate upstream and downstream components, a first for an Indonesian LNG project. The upstream component of the USD 2.8 billion project has an estimated cost of USD 600 million.

(Sourced from www.argusmedia.com)