Bakrie, Daewoo cooperate in gas pipe procurement

Local conglomerate Bakrie and Brothers, through its subsidiary PT South East Asia Pipe Industries (SEAPI) has signed a cooperation agreement with Korean trading house Daewoo in the procurement of undersea pipes for the gas pipeline project linking South Sumatra and Singapore, Kompas reported on Monday.

Bakrie said over the weekend that the cooperation was part of memorandum of understanding (MOU) agreements signed by Indonesian and Korean businessmen during the visit of President Megawati Sukarnoputri to the country last week.

The business group said that Daewoo would, under the agreement, supply 40 percent of the pipes for the South Sumatra-Singapore gas pipeline project. The remaining 60 percent would be procured by SEAPI from its own factories.

Bakrie said that it would also receive part of the raw materials for the production of the undersea pipes from Korean steel giant Pohang Steel Corporation (Posco) because PT Krakatau Steel is still unable to produce steel pipe for undersea use.

SEAPI won the tender to supply the undersea pipes for the Sumatra-Singapore gas grid which will cost about US$470 million to build. (*)