BPH Migas urged not to auction E. Kalimantan-C. Java gas pipeline project

State owned gas distribution company PGN has urged BPH Migas, the government’s regulatory body on oil and gas downstream industries, not to auction the construction of the East Kalimantan-Central Java gas pipeline project, and instead allow the company to carry out the construction of the inter-island gas pipeline project.

The demand was contained in a letter sent to the Minister of Energy and Mineral Resources Purnomo Yusgiantoro, rencenly. In the letter, President Director of PGN, WMP Simanjuntak said under the new oil and gas law, PGN has the legal rights to carry out the construction of the project with its own resources and technology.

Simanjuntak also said that PGN had established a consortium with several other state owned companies including PLN, PT Pusri, PT Inti Karya Pesada Teknik, and PT Tripatra Engineers and Constructors to handle the construction works of the project.

“PGN also still offer other state owned companies to take part in the consortium,” he said. “With the involvement of such companies, the problem related to financing, and the certainty of gas supply and demand can be resolved,” he said.

Meanwhile the chairman of BPH Migas, Tubagus Haryono, said in Jakarta on Tuesday that the agency would delay for several weeks the tender for the construction of the pipeline project.

“We should first settle the differences with PGN before formally launching the tender for the construction of the pipeline,” he said. He, however, said that BPH Migas would go ahead with its plan to auction the project despite PGN’s opposition. (godang)