Pertamina picks Chiyoda, Bechtel designs for plant<\/p>\n
JAKARTA (JP): State oil and gas company Pertamina has chosen
\nJapanese joint venture Chiyoda-Mitsubishi and American firm
\nBechtel to design the blueprint for its Tangguh liquefied natural
\ngas (LNG) giant project in Wiriagar, Irian Jaya, industrial
\nsources say.<\/p>\n
However, the selection has yet to be approved by Minister of
\nMines and Energy Susilo Bambang Yudhoyono, the sources said on
\nThursday.<\/p>\n
They said both companies had came out as winners in the
\ncompetitive bidding process held by Pertamina, beating five
\ncompetitors.<\/p>\n
The five competitors were Inti Karya Persada Teknik (IKPT) and
\nits American partner Kellog Brown & Root; French firm Technip;
\nJapanese firm JGC and its local partner Pertafinikki; American
\nfirm Flour Daniel and its partner Black and Veatch; and British
\nfirm Foster Wheeler and its local partner Tripatra.<\/p>\n
IKPT, controlled by Mohammad Bob Hasan, a close friend of
\nformer president Soeharto, has built several LNG trains in Badak,
\nEast Kalimantan, and had been appointed to design the Tangguh
\nproject during the Soeharto era. However, the contract was
\nrevoked after the resignation of Soeharto in mid-1998.<\/p>\n
Documents obtained by The Jakarta Post reveal Chiyoda-
\nMitsubishi proposed a design -- which is termed in the industry
\n\"a front end engineering design\" (FEED) -- based on Shell's air
\nproduct and chemicals international (APCI) technology, while
\nBechtel proposed a design based on Philip's optimized cascade
\nprocess technology.<\/p>\n
APCI technology is being used in LNG plants in Arun, Aceh and
\nBadak.<\/p>\n
The documents say Chiyoda submitted the best technical
\nproposal and the best commercial terms with a bid price of US$2.6
\nmillion, 78 percent lower than the estimated price of $10 million
\nset by project owners Pertamina and American firm Atlantic
\nRichfield Company (ARCO) and partners.<\/p>\n
Bechtel ranked second with a $8 million proposal, 12 percent
\nlower than the estimate of the project's owners.<\/p>\n
Director general of oil and gas at the mines and energy
\nministry Rachmat Sudibyo earlier told The Post the government was
\nlikely to approve two designs, based on APCI and Phillips'
\ntechnologies respectively, to ensure greater competition in the
\nbidding process for the construction of the project.<\/p>\n
\"By offering two designs, rather than one design, we expect
\nthe contractors to propose the lowest construction cost for the
\nbest technology,\" Rachmat said.<\/p>\n
Many analysts praised Pertamina for conducting a transparent
\nbidding process for the design, but some oil and gas executives
\nregretted the selection of Chiyoda, saying the price proposed by
\nthe Japanese firm was \"unreasonably low\".<\/p>\n
Spokesman for Pertamina's foreign contractors management body
\n(BPPKA) Sidick A. Nitikusuma maintained that the bidding process
\nfor the design making was transparent.<\/p>\n
\"The entire process has been totally transparent and all
\nIndonesian government regulations have been followed. This
\ntransparency has ensured that the international respect for the
\nintegrity of Indonesia's LNG industry has been maintained,\"
\nSidick told The Post on Thursday.<\/p>\n
Sidick refused to name the winners of the bidding.<\/p>\n
The Tangguh LNG project will be supplied with natural gas from
\nWiriagar, Berau and Muturi areas, which contain more than 14
\ntrillion cubic feet of proven gas reserves. The gas fields are
\nowned by Arco, BG Exploration and Production and several
\npartners.<\/p>\n
Pertamina estimates the construction cost of the project at
\n$600 million.<\/p>\n
Pertamina and Arco have yet to find buyers for the LNG, but
\nhave done preparatory works for the project to ensure that the
\nLNG plant could be quickly constructed once they do. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/pertamina-picks-chiyoda-bechtel-designs-for-plant-1447893297",
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