$50 million Lamongan port deal signed

Indra Harsaputra The Jakarta Post/Surabaya

PT Lamongan Integrated Shorebase (LIS) has signed an agreement with PT Rotary Engineering Indonesia to construct a US$50 million oil and gas port in Lamongan, East Java.

LIS was established in February last year and is co-owned by the East Java provincial government-owned firm PT Petrogas Wira Jatim and the Lamongan regency.

The port will be 55 percent owned by LIS, while Eastlog Holding Ptc. Ltd. of Singapore will hold the remaining 45 percent.

President director Abdul Muid said the port and warehouses would be located in the Tanjung Pakis area and would be completed in the first quarter of next year.

"The construction of those facilities will start soon," he said after signing the agreement.

The Lamongan facility would be the nation's fourth oil and gas port, and the first outside Batam island.

The new port is expected to make the country more internationally competitive, especially with Singapore, which has similar facilities in Loyang, Jurong and Sembawang.

It will offer facilities such as cargo handling, rig anchoring and maintenance, along with customs, immigration and quarantine (CIQ) services.

There will also be open stockpiling yards, warehouses, silos for bulk materials, an explosive bunker, workshops and a training center within the compound.

Abdul said the first phase of the complex would be constructed on a 75-hectare plot of land at a cost of US$25 million.

"Soon after the port's operations begin, we will start the second phase; the expansion of the facility to 140 hectares at a cost of $25 million.

Companies including PT Andhika, PT Aneka Gas and Kodeco have already signed agreements with LIS to use the port.