PGN selects Petronas to buy pipeline stake
Tuesday, April 16 2002 - 04:03 AM WIB
PGN selected Petronas from a short-list of four bidders vying for a 25 to 40 percent equity stake in a PGN operating unit under which the major asset will be a planned US$470 million pipeline from Sumatra to Singapore.
The sale is to help fund the pipeline and meet requirements set by one of its creditors, the Asian Development Bank.
"The Petronas consortium has been appointed as the negotiating partner with PGN for the share sale," said Widyatmiko Bapang, PGN's corporate secretary, in an interview with Reuters.
While no final deal has been inked, Petronas' selection as an exclusive negotiating partner indicates they are the likely winner.
"They are the most likely to win, but there are other bidders if we fail to get a deal with Petronas," Bapang said.
He said a final decision was expected within one week.
The Petronas group includes Gulf Indonesia Resources Ltd, Talisman Energy Inc and Singapore Petroleum Corp.
PGN officials have said previously that they hope to raise as much as $200 million $250 million from the sale.
The other bidders include Unocal Corp together with El Paso Corp, Korea Gas Corp together with the AIDEC Management Co (AIMAC) and a bid led by Singapore Power.
Selecting an investor has been a major hurdle slowing down the progress of the Sumatra-Singapore pipeline. Delivery of gas is expected to begin in the second half of 2003. (*)