Marathon subsidiary to provide LNG for company’s Tijuana project

Petroleum News

Marathon Oil's proposed Baja California liquefied natural gas regasification project has gotten its LNG supply.

Marathon and co-participants in the proposed Tijuana Regional Energy Center — Grupo GGS, S.A. de C.V. and Golar LNG Ltd. — said Aug. 27 that Marathon subsidiary GNBC VENTAS, S. de R.L. de C.V. has signed a memorandum of understanding for LNG supplies with Pertamina and P.T. Exspan Tomori Sulawesi.

Under terms of the MOU, Marathon said, Pertamina and Exspan would supply up to 6 million metric tonnes of LNG per year for 20 years from a new LNG plant to be constructed on Sulawesi Island, Indonesia.

"We are very pleased to have reached this agreement with Pertamina and Exspan, as it represents another important step forward for our Tijuana Regional Energy Center project," John S. Hattenberger, senior vice president of Marathon International Petroleum Ltd. and managing director, GNBC, said in a statement. "The Matindok and Senoro blocks in Eastern Sulawesi have the potential to provide the resources necessary to form a third LNG center in Indonesia. These gas resources would be a significant LNG supply source to the Tijuana Regional Energy Center."

The proposed Tijuana center includes an LNG offloading terminal, a 750 million cubic feet per day regasification plant, a 1,200-megawatt power generation plant to supply regional electricity needs, a 20-million gallon per day seawater desalination plant to provide fresh water for the city of Tijuana, wastewater treatment facilities to augment existing processing capacity of the San Antonio de Los Buenos treatment plant, and related natural gas pipeline infrastructure.

Marathon said it is proceeding with necessary regulatory reviews and permits as required by federal and local authorities in Mexico and if those approvals are received and commercial and financing plans put into place, construction could begin in 2004, with start up in 2007.