Rekind, West Java firm sign agreement on gas pipeline project

State-owned engineering and construction company PT Rekayasa Industri (Rekindo) will cooperate with PT Energi Negeri Mandiri, a subsidiary of West Java provincial-owned company PT Migas Hulu Jabar, in the development of the long-stalled Cirebon-Semarang gas pipeline project.

Rekind Director for Strategy Development and Risk Management, Yanuar Budinorman said in a statement on Tuesday the company has signed a cooperation agreement with Energi Negeri to take gas from the Cirebon-Semarang pipeline. He did not provide further details about the cooperation between the two companies.

Rekind first gained the exclusive right to develop the 235-km gas pipeline project in 2006, but the project has suffered lengthy delays due to the company failing obtain the necessary gas supply and off-takers of the piped gas. Downstream oil and gas authority BPH Migas has recently questioned Rekind?s seriousness in developing the project.

Yanuar said on August 18 the company was still committed in developing the project as it was still looking for potential gas off-takers in Central Java and West Java as well as the required gas source for the project.

He expected that the company hopes to submit the list of potential off-takers at the end of August to the Ministry of Energy and Mineral Resources. The government will then help Rekind to get the gas sources, which may come from nearby fields or via LNG shipment.

The Semarang-Cirebon is part of the integrated 682.1 km trans-Java pipeline network.

Editing by Reiner Simanjuntak