PGN says it has yet announce Transco I bid winner

State gas distribution firm PGN on Tuesday denied media reports that it had picked Petronas-led consortium to become the company's strategic partner in its new pipeline subsidiary.

"We haven't made any decision yet. We are still evaluating the bids and will hold another talk with the two consortium," said WMP Simandjuntak, PGN president director on sideline of a MoU signing with Gulf Indonesia Resources in Batam.

Petronas-led consortium which consist of Gulf Indonesia Resources Ltd, Talisman Energy Inc and Singapore Petroleum Corp while Kogas-led consortium Unocal Corp together with El Paso Corp and AIDEC Management Co (AIMAC), are the final bidders for 25 to 40 percent stake in Transco I, PGN subsidiary which will run gas pipeline from South Sumatra to Duri in Riau and from South Sumatra to Singapore.

Transco I plans to develop the South Sumatra-Singapore gas pipeline, which will deliver about US$9 billion worth of natural gas over 22 years to Singapore starting 2003.

Simandjuntak said that the winning consortium might be announced "in the next few weeks".

He also dismissed fears that PGN would not be able to complete South Sumatra-Singapore gas pipeline on time.

"We are confident that we would be able to complete the pipeline in time. We are going to commence pipeline construction which are divided into five segments simultaneously in June," he said.

Another PGN's senior official assured that there are ways to speed up the development even if the construction starts late.

"If we have to, we could speed up construction time by one third even if it would mean we would have to increase total cost up to 5 percent. That's a better option than having to pay US$ 80,000 per day for late penalty," he said.(alex)