ASEAN gas pipeline closer to reality, claims official

ASEAN gas pipeline closer to reality, claims official

KUALA LUMPUR (Reuters): A natural gas pipeline connecting Southeast Asian countries could become a reality by 2010, a senior official overseeing the project said on Tuesday.

"The authorities have set a target date of 2010 for completion of the trans-ASEAN gas pipeline (TAGP). It can be done," Mohd Farid Amin, lead coordinator of TAGP task force, told Reuters in an interview.

Energy and industry ministers of the 10-member Association of South East Asian Nations (ASEAN) at a meeting in Bangkok in July resolved to hasten implementation of an action agenda at the December 1998 ASEAN summit and adopted an interim action plan for energy cooperation running to 2004.

"The first major hurdle has been overcome when the ASEAN member countries collectively agreed to move this project together," Mohd Farid said.

"Malaysia and Indonesia particularly want to develop it fast. We want to plan ahead and hope to shorten the time for realizing this project. We have to do it fast as by the next decade oil reserves in the region will be depleted. So we have to rely more and more on gas.

"It's only that we need support from the governments to encourage the usage of more gas," he said.

ASEAN has proven reserves of about 230 trillion cubic feet of natural gas, he said.

Mohd Farid said whilst inter-connection may not pose serious problems to ASEAN member nations due to the existence of a basic gas delivery system, there are a number of key issues which have yet to be resolved.

These include cross-border issues, legal matters as well as financial, environmental and technical factors.

ASEAN groups Thailand, Myanmar, Cambodia, Vietnam, Laos, Malaysia, Singapore, Brunei, Indonesia and the Philippines.

Mohd Farid said with regional economies coming out of the recession, some of the projects can get back on track.

"To realize this mega projects, billions of U.S. dollars investments would have to be made," he said.

Thailand last month approved a proposal to invest in a $1.03 billion natural gas project with Malaysia's national oil firm Petronas involving the building of a 352-km (220-mile) gas pipeline and a gas separation plant.

The project involves development of natural gas from fields in Thailand's and Malaysia's overlapping Joint Development Area. The pipeline will transmit gas from the area to southern Thailand.

The Thais will start taking gas from the field in 2002 at an initial two-three million cubic feet per day.

"The economic downturn has affected gas demand in Thailand. The Thailand part of the project under phase two will be done later. The Malaysian part of the project is expected to be completed in 2001," Mohd Farid said.

Other projects include the development of the Yetagun gas project which will land gas from the fields in Myanmar to Thailand and the West Natuna project, expected to be completed in 2001, involving supply of gas from offshore Indonesia to Singapore.

Petronas president and chief executive Hassan Marican told an energy forum on Tuesday that these developments were bringing the trans-ASEAN gas pipeline project closer to reality.

"What is left is our determination, commitment and cooperation to fill in the missing links to realize the project," Hassan said.

Mohd Farid said gas development projects in the Philippines and Vietnam were still in their early stage. "But the fact is that they want to use the gas. The drive is there," he said.