PGN officially starts the US$1 billion pipeline project

State owned gas distribution company PGN has officially started its US$1 billion pipeline network to distribute gas from South Sumatera to West Java. The project is scheduled for completion in 2006, Kompas reported on Friday.

PGN's president director WMP Simanjuntak, said in Jakarta on Thursday that the project would be divided into two phases but would be carried simultaneously so that the two segments of the pipelines could be completed at the same time.

The first phase, which will comprise of a 490-km pipeline network linking gas receiving terminal in Pagar Dewa, South Sumatera to West Java through Lampung province, will cost about US$485 million. The second phase, which will a comprise of a 650-km network connecting the South Sumatera-West Java network to the existing Grissik-Singapore pipeline will cost about US$570 million.

Simanjuntak said that the new gas pipeline network would be able to increase the volume of PGN's gas sales to 950 million standard cubic feet per day (MMSCFD) from 300 MMSCFD at present.

"Many industrial users in Celegon, West Java have been on the waiting lists to get the gas supply," he said. (*)