January 2012 - PT IEV GAS has received the official renewal of the Gas Sales and Purchase Agreement (“GSA”) by PT Indofood CBP Sukses Makmur Tbk (“PT Indofood”) for the delivery of compressed natural gas (“CNG”). The official renewal of the GSA was signed and delivered to IEV during the festive period at the end of December 2011 and took effect retrospectively from 1 December 2011.
PT Indofood, a public listed company on the Indonesian Stock Exchange (“IDX”), is an established and major producer of packaged food such as noodles, dairies and snacks. The manufacturing division of the company is based in Bandung, about 110km away from PT IEV Gas’ CNG processing plant. Under this take-or-pay GSA, which is subject to a minimum off-take of 85% of the contracted units of energy, PT Indofood will purchase approximately 450,000 million metric British thermal units (“mmbtu”) of CNG from IEV over this 24-month period from December 2011, computed based on an assumed average delivery rate of 18,750 mmbtu per month.
This renewal follows an existing agreement between IEV and PT Indofood which recently expired. Under the previous GSA, IEV had agreed to sell a maximum of 380,600 mmbtu but actually sold 431,276 mmbtu of CNG to PT Indofood over a period of 20 months that ended in November 2011.
President and CEO of IEV, Mr Christopher Do, commented “IEV’s vision is to bring not just energy but clean energy to the doorstep of industries without gas pipeline access. We are delighted that PT Indofood is extending their business relationship with us. We believe that the renewal of this GSA underscores PT IEV Gas’ stature as a reliable and trusted energy distributor to major industrial customers in Indonesia.”
Natural Gas is considered a relatively cheaper alternative and clean source energy for industries requiring heat energy. Whilst Natural Gas is predominantly supplied through gas pipelines, there are many industries located out of the traditional gas pipeline perimeter where building such costly infrastructure is not feasible. IEV’s Mobile Natural Gas is in a position to provide energy solution for such industries. IEV’s Mobile Natural Gas Division utilises cost effective methods to produce and transport natural gas in compressed form and transported to the customer’s doorstep.