Saipem launches fabrication yard construction

Italian-based turnkey oil and gas contractor Saipem International has begun construction of a fabrication yard in Karimun, Riau Islands, with a total project investment of Rp 2.5 trillion (US$271 million), the Jakarta Post reported Monday.

During the launch ceremony of the ground-breaking facility Friday, Saipem offshore general manager Yves Inbona told the press the yard would be the company?s largest production facility of its kind.

Occupying some 140 hectares of land, the facility would have a production capacity of 30,000 tons of oil and gas related components.

?The production facility will be one of the company?s largest. Products from here will be allocated for demands in Indonesia as well as for neighboring areas,? said Inbona, adding the company expected the facility to start operations in 2010.

He said Karimun Island was chosen to house the facility due to its free-trade zone status.

The company, which plans to employ 5,000 workers, has requested local administration improve business infrastructure on Karimun, including highways, power capacity and ports to help boost the operation?s efficiency.

Riau Islands governor Ismeth Abdullah said the administration decided to make Karimun Island a center for maritime business due to its deep water access that can accommodate large vessels, making it ideal to serve as a shipyard and offshore production facility. (*)