Piping project in Java to be tendered soon

State oil and gas firm Pertamina will soon open a tender for two segments of piping projects on Java island, following the withdrawal of a consortium of Bimantara-Lamtorogung-Triharsa-Tranaco from the project.

Pertamina's director for domestic storage and marketing, Harry Purnomo, said the two segments of piping projects were the Yogyakarta-Semarang and the Malangbong-Balongan projects.

"We will hold an international tender for the projects by the end of this year," Harry said.

He added that Pertamina canceled the contract with the consortium of investors led by Bimantara after they decided to withdraw from three segments of piping projects worth US$325 million because of financial constraint. The other segment is that linking Bandung and Sukabumi in West Java.

Harry noted that with current situation, the value of the projects would also be revised down to about only US$175 million.

He said a number of foreign investors had shown their strong interests in participating in the tender, including those from Singapore, Japan, South Korea.

The projects would be offered under the built and transfer (B&T) scheme. Under the scheme, Pertamina would pay the investors based on the volume of fuels transported through the piping network based on an agreed terms of payment. (*)