PGN agrees renegotiate the compensation for its pipeline project

State owned gas distribution company PGN and local governments at several regencies in South Sumatra have agreed to renegotiate the compensation of the land used by the company for its pipeline project in the province, Kompas reported on Tuesday.

The agreement was made during a meeting in Palembang on Monday. The meeting, which was led by the deputy chairman of the South Sumatra province's legislative council and representatives from PGN and the villagers, was held after the local people protested the offer made by PGN.

PGN has offered to pay a compensation ranging between Rp 1,050 and Rp 2,850 for each meter of land used for its gas pipeline. But the people said that the amount offered by PGN was too small and demanded PGN to raise the compensation payment to between Rp 10,000 and Rp 15,000 per meter.

PGN is constructing a massive pipeline linking South Sumatra, Lampung and Banten. The pipeline segment in South Sumatra passes through four regencies in South Sumatra, with the length of about 270 kilometers. (*)