PLN evaluates 7 contractors for Banten LNG receiving terminal

State-owned electricity firm PT Perusahaan Listrik Negara (PLN) is evaluating bidding prices proposed by seven local and foreign bidders of engineering, procurement and construction (EPC) of a liquefied natural gas (LNG) receiving terminal in Bojonegara, Banten, Investor Daily reported Friday.

The evaluation is being conducted pending the certainty about the supply of gas that PLN is now striving to seek, PLN's expert staff of primary energy plant Eden Napitupulu said in Jakarta Thursday.

Eden said that majority bidders were foreign contractors, of which several involve local companies through a consortium. Marubeni Corporation, Mitsui and PT Adhi Karya Tbk. have been cited as companies among the seven bidders.

Eden said that the construction of the LNG receiving terminal would need an investment of US$ 300 million or approximately Rp 2.7 trillion. "The funding will come from PLN budget," Eden confirmed.

Based on PLN calculation, Eden said, if the price of gas that PLN will buy is US$ 3.5 million per MMBTU, then PLN can sell electricity at U.S. 4.865 cents per kWh or equivalent to Rp 450 per kWh.

"Despite the gas price of US$ 5 per MMBTU, we can still sell the power for U.S. 5.6 cents per kWh or Rp 500 per kWh, which is efficient for PLN and its is unnecessary for the public to complain that the power price is too high," he said.

The tender for the construction of LNG receiving terminal in Bojonegara, Banten started in May 25, 2005, with as many as 25 local and foreign companies included on the shortlist of bidders. (*)