PGN to invest $200m for gas pipelines

Petromindo|Lucky

IDX-listed gas distribution company PT PGN Tbk plans to invest up to US$200 million this year to develop new gas pipeline networks, both transmission and distribution, Bisnis Indonesia reported on Monday.

The paper quoted PGN Director of Technology and Infrastructure, Dilo Seno Widagdo as saying that his company will continue to invest in new pipelines despite the lingering weak market condition in a bid to help increase the number of gas consumers. ?We have capex of around $200 million,? he said.

He explained that the planned capex this year will be used to finance a number of projects. First, the Duri-Dumai distribution and transmission pipelines in cooperation with PT Pertamina Gas. In this particular project, PGN will allocate $30.4 million of the total investment requirement of $76 million in line with the company?s 40 percent interest in the project. A total of 67 km of transmission pipeline and 60 km of distribution pipeline will be developed.

Second, construction of the West Natuna Transportation System (WNTS)-Pemping transmission pipeline. In this project, PGN will develop a 5 km connecting pipeline with capacity of 120 mmscfd, which is targeted to be completed this year.

Third, the development of gas pipeline network in East Java totaling 2.2 km. The gas will be supplied by Husky-CNOOC Madura Ltd at a volume of 60 mmscfd.

And fourth, household gas pipelines for a total of 26,000 households in Mojokerto (East Java), Musi Banyuasin (South Sumatra), Jakarta and Bandar Lampung.

Dilo said that with the new gas pipelines, the company expects gas consumption to increase this year. (*)