VEEP: POTENTIAL LOSS TO TANGGUH GAS FIELD IS RP700 TRILLION

Bandung, Aug 29 (ANTARA) - Vice President Jusuf Kalla corrected a media report which said Indonesia had suffered a loss of Rp70 trillion in negotiations on Tanggung LNG exports to China, because the actual potential loss reached Rp 700 trillion.
"The potential loss of the state is Rp700 trillion or USD70 billion," Kalla told the press after inspecting the manufacturing of tanks for the military by state arms maker PT. Pindad.
Earlier, it was reported that the government was exploring a possibility of renegotiating the price of Tangguh gas in Beijing which will incur a loss of about Rp700 trillion to Indonesia.
He also said that a loss of about USD3 billion per year if multiplied with 25 years as the period of the contract would amount to USD 70 billion.
According to him, the formula to set the price of Tangguh gas was the worst in oil history.
The mistake in the contract is that the price is equivalent to the percentage of fuel oil which is standing at five percent.
In fact, the percentage for Arun gas for 30 years was 7.5 percent and Bontang gas 15 percent for 25 years.