PGN will spend US$1.58 billion to build new gas pipeline
Friday, September 22 2000 - 03:30 AM WIB
State owned gas company Perusahaan Gas Negara (PGN) will spend about US$1.58 billion to build a gas pipeline linking Java and Sumatera as part of its program to expand its gas distribution networks, DetikCom reported on Friday.
PGN's president Qoyum Tjandranegara said in Jakarta on Thursday that the planned pipeline would be linked into the planned Asia and Pasific gas grid, which would link buyers and gas resources in the region into an integrated gas pipeline network.
He said that the Java-Sumatera gas network would be divided into three sections - Gresik (East Java) to Duri in Riau, Palembang (South Sumatera) to Singapore, and Palembang to Jambi.
The gas grid linking Gresik and Duri will absorb investment of about $310 million, about $40 million of which would be in the form of loans from the Asian Development Bank, Japan Exim Bank and European Investment Banking (EIB), he said.
Qoyum said that the construction of the Gresik-Duri gas pipeline project which is now under construction will have the capacity to convey about 310 million cubic meters a day
The second pipeline which will link Palembang and Singapore will absorb investment of about $420 million, mostly in the form of loans from EIB and ADB. The new grid, which will have the capacity to convey 380 million cubic meters of gas, is scheduled for commercial operation in May 2003.
The third grid linking Palembang-Jambi will need investment of about $850 million and will be financed by loans from Japanese financial agencies. The grid will have the capacity to transport 600 million cubic meters a day. (*)