Kalila to build gas pipeline to PLTG Teluk Lembu

State electricity company PT PLN and Kalila (Korinci Baru) Ltd, a subsidiary of PT Energi Mega Persada Tbk (EMP), and upstream oil and gas regulator BPMIGAS have agreed that Kalila will be responsible to build gas pipeline from Korinci Baru Block to gas-fired power plant PLTG Teluk Lembu, Pekanbaru, Riau province.

Korinci Baru block which is located in Pelalawan district, Pelalawan regency in Riau province, is owned and operated by Kalila Ltd, while PLTG Teluk Lembu is owned by PLN.

PLN division head for gas and oil-based fuels Suryadi Mardjoeki said that in order to speed up the construction of the pipeline, the cost to construct the pipeline will be borne by PLN. ?Thus the cost recovery of Kalila to build the pipeline will be covered by PLN,? said Suryadi.

Suryadi said BPMIGAS has agreed that PLN will be charged US$0.6 per MMSCFD for transporting gas via the 40-km pipeline. He expects the installation of the pipe will be completed in 2012.

Under the old contract agreed by PLN and Kalila (Korinci Baru), Kalila should have begun supplying gas with volume of 15-30 MMSCFD starting 2009 until 2020, however, up until now, Kalila only manages to supply 7.5 MMSCFD of gas. To cover the shortfall, Kalila plans to boost gas production in Seng wells (2,3 and 4) and Segat 1 well. (bernard)