PGN delays selecting strategic partner until February 02

State gas company Perusahaan Gas Negara (PGN) is delaying the selection of its strategic partner, which was earlier scheduled in November to February next year, according to industry sources.

PGN is looking for strategic partner to finance the construction of pipeline that would transmit natural gas from South Sumatra to Singapore.

The pipeline project would cost PGN some US$ 470 million.

The sources said PGN would offer between 25 percent to 40 percent interest for the project in exchange for fund up to US$ 200 million.

Earlier, PGN president Qoyum Tjandranegara said that PGN had already secured US$ 270 million loan from Asian Development Bank and European Investment Bank.

He also said that more than 10 companies had already expressed their interest to become PGN?s strategic partner, including Tokyo Gas Corp., PowerGas of Singapore, Petronas of Malaysia, Enron Corp and Gulf Indonesia Resources.

The sources, however, said that the delay would not disturb the project schedule.

"There would be no delay in pipeline construction and PGN will be able to pipe gas to Singapore as scheduled," said the sources.

Singapore electricity company Singapore Power will import 150 million standard cubic feet per day (MMCFD) of gas beginning in mid-2003 through the gas pipeline, pumping up to 350 MMCFD by 2009, for a total volume of 2.27 trillion cubic feet over 20 years.

The natural gas will be supplied from the Corridor and South Jambi B production-sharing contract (PSC) areas, both operated by Gulf Indonesia Resources Limited, and from the Jabung PSC area operated by Devon Energy. (alex/godang)