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Australia's Santos output hit by Java pipe incident

Written by: Staff

SYDNEY, Nov 23 (Reuters) Australian oil and gas firm Santos Ltd. said on Thursday that some gas production has been shut in after a serious incident at the East Java gas pipeline in Indonesia.

Santos said in a statement it was advised of the incident, which resulted in some fatalities, late on Wednesday evening, and is seeking further information on the cause.

The Maleo gas project, in which Santos has a 67.5 percent stake, has shut in production as a consequence of this incident, Santos said in a statement.

Maleo gas, along with gas from other fields in the area, is delivered into the East Java pipeline.

Santos' net entitlement production from the Maleo field was approximately 7,000 barrels of oil equivalent per day prior to the incident, it said.

Shares in Santos were down 1.7 percent at A.98 in early trade.

Santos uses the pipeline to transport gas from the Maleo field to Indonesian state-run gas distribution company, PT Perusahaan Gas Negara (PGN) .

Production commenced from the Maleo gas project during September 2006, making it Santos' first operated offshore gas project outside of Australia.

Antara, Indonesia's official state news agency, said on Wednesday the burst in a part of the state-owned Pertamina East Java Gas Pipeline killed six people and caused massive fires.

Reuters SBA VP0640

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