Norway?s BW wins tender to provide FPU for Kangean

Norway?s BW Offshore Limited has been declared the winner in the retendering of the contract to provide Floating Production Unit (FPU) for the Terang Sirasun Batur (TSB) fields in the Kangean block offshore East Java, a senior official at oil and gas upstream sector regulator BPMIGAS said on Friday.

BW was named the winner after ending up being the only bidder of the project.

Initially, there were three consortia, including BW in a consortium with a local company participating in the first tender, but two others, that is PT Berlian Laju Tanker-Modec and PT Supraco-Fred Olsen consortia decided to withdraw because they did not feel comfortable with the cabotage law which requires all vessels operating in the country, including FPU, to carry Indonesian flags starting this year. BPMIGAS then retendered the project.

According to Hadiono, BW offered the FPU at US$916 million for a 14-year leasing, higher than the benchmark price of $840 million set by BPMIGAS.

BPMIGAS is negotiating with BW on the price and is hiring a financial consultant to review the benchmark price, Hadiono said, adding that Kangean Energy Indonesia Limited had asked the agency to negotiate with BW.

Kangean Energy is the operator of block. The TSB fields are being developed with planned peak production of 300 MMCFD. (Bernard)