ATC Atlantic Coal

RNS No 1703e
ATLANTIC RICHFIELD CO
27th August 1998


ARCO Chairman Meets With Indonesia's President to Discuss Maintaining
Indonesia's No1 LNG Marketing Position, New Investments and Domestic Fuel
Switching Opportunity

JAKARTA, Indonesia, Aug. 27/ PRNewswire/ -- ARCO's Chairman and Chief Executive
Officer Mike R. Bowlin met with Indonesian President B.J. Habibie to discuss
progress on achieving timely startup of the multi-billion dollar Tangguh
liquefied natural gas (LNG) project in the eastern Indonesian province of Iriah
Jaya.

Tangguh has 14.4 trillion cubic feet (TCF) of proved natural gas reserves, with
a total of 21.3 TCF when probable and possible reserves are included.
Development of the LNG project will involve a US $4 billion investment on the
part of ARCO and its partners, including Indonesia's national oil and gas
company, Pertamina.
President Habibie and Bowlin discussed the significance of the Tangguh project
and the exciting opportunities it creates for Indonesia.  Bowlin noted, "Tangguh
is the key to preserving Indonesia's position as the world's leading LNG
supplier and a major future source of foreign exchange for the country.  It will
also lead to considerable infrastructure and community development in Irian
Jaya, creating 8,000 jobs during construction and 1,000 operating jobs after
startup.

"The development of Tangguh is also very timely as it will allow Indonesia to
extend the expiring LNG contracts it has today.  With Tangguh, Indonesia will
significantly increase its reserves of marketable LNG for the Asia-Pacific
market," Bowlin added.

The competitive strengths of Tangguh in the Asia-Pacific LNG market are based on
a number of factors.  These include: security of supply afforded by three LNG
centers in Indonesia, favorable transportation routes, and the backing of 14.4
TCF of proved reserves; the high quality of Tangguh gas which is low in both
carbon dioxide and sulfur; and proximity of supply to major markets throughout
the region.  Together, these factors provide best-in-class development cost
advantages that translate into competitive terms in the marketplace.
Commenting on the recent US $3.3 billion acquisition of Union Texas Petroleum
(UTP) and its relationship with Tangguh, Bowlin said: "The acquisition expands
both ARCO's LNG expertise and gas holdings, making ARCO the premier gas company
in Indonesia based on capabilities, reserves and production.  The timing of the
acquisition is also significant in that it reflects our continued and commitment
to Indonesia at a time when the country has severe economic difficulties."
In addressing other energy issues of importance to Indonesia, Bowlin cited the
opportunity for cost-effective fuel substitution.  Currently, Indonesia imports
significant volumes of crude oil products, including 70,000 barrels per day of
diesel fuel.  Fuel substitution could conserve Indonesia's precious foreign
exchange reserves.

"By switching power generators and industrial users from imported diesel fuel to
domestic natural gas, Indonesia could realize savings ranging from US$100-200
million annually," Bowlin stated.  "In addition, domestic natural gas
utilization is environmentally friendly."

ARCO,which has been operating in Indonesia for the past 30 years, is Indonesia's
largest natural gas producer for the domestic market.  ARCO operated properties
supply two-thirds of Java's natural gas needs.  ARCO has also consolidated its
position as a leading developer of natural gas in the Asia-Pacific region
through existing production in Indonesia and the South China Sea, vast gas
reserves on the North Slope of Alaska, the UTP acquisition, and the recent
partnership with Triton Energy in Thailand and Malaysian.

For additional information, contact: Albert Greenstein 213-486-3384. For a menu
of ARCO news releases or to retrieve a specific release, visit our Website at
http://www.arco.com on the Internet.

END

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