Singapore firm seeks compensation from Indonesia
Saturday, September 6 2003 - 12:26 AM WIB
A technical problem has forced PT Perusahaan Gas Negara to delay piping 85 million cubic feet a day of gas to Singapore via a 477-kilometer pipeline running through the island of Batam.
In 2003-04, Gas Supply will receive 150 million cubic feet a day (MMCFD)of gas from the Grissik field, with the supply hitting the maximum of 350 MMCFD in 2009.
Speaking on the sidelines of the signing of a domestic sales and purchase contract between Gas Supply and City Gas, Tan said the compensation is based on the supply contract terms.
"It will be calculated based on the number of days the gas supply was delayed," he said.
Tan declined to estimate the value of the compensation.
The initial gas flow arrived in Singapore Wednesday night, almost one month from the original scheduled date of Aug. 12, he said.
"The first gas is filling the pipe now at about 60-pound pressure, but the gas pressure will be gradually increased to the required 420 pounds in five days' time," from Wednesday, Tan said.
The first tranche of gas supply, which will only flow on early next week, is to go to Power Senoko to run its steam turbines for now, but the gas will eventually be fed to the utility company's new 360-megawatt gas unit that will be commissioned in the fourth quarter of next year.
Given that the initial gas flow is to begin Sept. 9, the supply delay would have lasted 28 days.
According to the Indonesian supply contract, the gas supplier is allowed a grace period of three months for any delay in the pipeline construction, but not the gas delivery, Tan said.
Officials from BP Migas - the Indonesian state gas marketing company - are unavailable for comment Friday.
Tan also said the total 350 MMCFD supply of Indonesian gas is about 80% sold so far despite the current weak local economy.
Meanwhile, Gas Supply sold 15 MMCFD of Indonesian gas to City Gas for a period of 20 years for about S$20 million.(*)