PGN awards pipeline construction contract to Japan?s JFE Engineering

JSX-listed state gas distribution firm PGN on Tuesday signed engineering procurement contract with Japan engineering firm JFE Engineering Corp. to construct 270-km 32 inches onshore pipeline from Pagardewa in South Sumatra to Labuhan Maringgai in Lampung province.

The pipeline is part of South Sumatra-West Java pipeline grid development, which will transport gas from South Sumatra to industrial provinces of Banten, West Java and Jakarta.

PGN said in a release that the contract was worth US$161 million. The funding was obtained from Japan?s JBIC.

The pipeline segment, which known as SSWJ Phase I would transport gas from Pertamina?s South Sumatra gas fields. The pipeline has transmission capacity of 460 MMCFD and could be ramped up to 600MMCFD with compressor addition.

The pipeline is expected to be completed March 2007.

PGN also said it would also in the process of developing 661-km SSWJ Phase II pipeline from Grissik-Pagardewa (South Sumatra), Pagardewa-Labuhan Maringgai (parallel with SSWJ I), Muara Bekasi-Rawamaju (West Java). SSWJ Phase II would transport gas from ConocoPhillips-operated Corridor Block in South Sumatra with capacity of 520 MMCFD, rampable to 600MMCFD. The pipeline is expected to be completed October next year. (godang)