Infrastructure watchdog to decide the fate of E. Kalimantan-E. Java gas pipeline project

The Ministry of Energy and Mineral Resources has transferred the East Kalimantan-East Java gas pipeline project to the government's committee for the acceleration of infrastructure projects KPPI in a bid to resolve the growing dispute over the status of the inter-island pipeline project.

"The problem has been transferred to KPPI which is under the direct supervision of Coordinating Minister of Economy," Minister of Energy and Mineral Resources Purnomo Yusgiantoro said in Jakarta on Thursday.

Tubagus Haryono, the chairman of BPH Migas, the government's regulatory body for oil and gas downstream industries, said that his office could accept the decision. KPPI, however, should ask the Ministry of Energy and Mineral Resources to change the master plan of the project so that the project could escape the tender obligation.

State owned gas distribution company PGN has asked BPH Migas not to tender the project because the company had the capability to handle the project with its own resources. BPH Migas, turned down the request, insisting that under the existing regulations, the 1,100 KM pipeline project should be tendered.

The giant pipeline project which be built with total cost of about US$1.3 billion would have a capacity to transmit 1BCFD of gas to East Java. (dino)