Japan?s $415 million loan for Sumatra-Java pipeline project to be signed in October
Friday, September 13 2002 - 07:08 AM WIB
The governments of Indonesia and Japan will sign next month an agreement on US$415 million soft loan to finance the construction of a 640-kilometer natural gas pipeline from South Sumatra to West Java, the president director of state gas transmission and distribution company PGN, WMP Simandjuntak, said on Thursday.
Indonesia expected the 40-year loan to be disbursed in 2003 so that PGN could start building the gas pipeline in the same year, Simandjuntak told reporters as reported by Tempo daily.
Simandjuntak said the loan?s collateral would be in the form of 20,000 barrels of crude oil. The assistance fund would be channeled through Japan Bank for International Cooperation, he added.
The pipeline project required a total of $486 million, of which $71 million will be from PGN?s coffer.
The pipeline is planned to transmit some 250 million standard cubic feet per day (MMSCF) of gas, ramping up to 700 MMCFD, from Pagar Dewa in gas rich South Sumatra to the industrial province of West Java. (*)