Geo Putra asking for extension of crude transmission contract
Thursday, April 30 2015 - 12:51 AM WIB
PT Geo Putera Perkasa (GGP) is waiting for the Ministry of Energy and Mineral Resources (MEMR) and upstream authority SKK Migas to extend its contract to transmit crude produced by PT Pertamina EP (PEP), a subsidiary of state owned oil and gas firm PT. Pertamina (Persero).
GPP?s President Director Eko Taufik Syah Putera said the firm has submitted a request for the extension of the contract and PEP as the user of its service has also expressed support to the request. However, the MEMR and SKK Migas has yet to respond to the request, while the contract expires this month.
?We need certainty regarding the extension of our contract,? he told Petromindo.com.
Eko said GPP won an open tender for the contract held by PT Pertamina EP Cepu back in 2009. In line with the contract, the company built a 40-km crude pipeline from Gayam village to Mudi village with a capacity of 22,000-44,000 bopd as well as a storage with a capacity of 100,000 bopd.
In 2012, the firm was asked to build another pipeline with a similar capacity. The pipeline was completed in 2013 but has never been used to transmit any crude. If anything, the volume of crude transmitted through the first pipeline was reduced from 24,000 bopd to 16,000 bopd.
As a result, GPP is facing potential loss and may be unable to recoup its investment which reached US$70 million, Eko said.
Editing by Johannes Simbolon