Delays expected in tendering Natuna projects
JAKARTA (JP): The government may delay the tendering of development projects in Natuna until next week from the original schedule of Oct. 1 because it is still finalizing the projects' legal framework, a minister said yesterday.
"We have delayed the tendering not because of technical problems but because of legal problems. The President has already issued decree No.97/1996 on the development of Natuna. And now we're finalizing a ministerial decree on its implementation," State Minister of Research and Technology B.J. Habibie said.
"Hopefully, we can finalize the ministerial decree later this week and tender the projects some time next week," said Habibie after addressing a seminar and workshop on Norwegian and Indonesian Science & Technology for Sustainable Development.
The government announced Sept. 25 that it would tender the Natuna projects, including a gas project, on Oct. 1.
According to Habibie, the development projects are to begin in 1998 and will include the development of the Natuna islands in Riau into a center for natural gas liquefaction and high- technology industries.
He refused to identify the companies that will take part in the tendering but said that they come from Norway, Germany, France, the United States, Britain and Japan.
"All of them have an equal chance to win the contracts. But we'll select them by considering their technological capability and experience," he said.
He said that the contracts to be awarded will include the construction of infrastructure, the development of a gas field and the construction of two liquefied natural gas (LNG) plants, which are expected to start production in 2003 or 2004.
"The infrastructure will cost about US$10 billion, while the gas projects US$20 billion," he said.
Habibie said that the liquefied natural gas plants would produce up to 15 million tons of LNG a year for 30 years.
Indonesia is the largest producer of LNG in the world, with its total production 22.2 million tons a year, or 30.2 percent of the world's total output.
The country's LNG, all exported to Japan, South Korea and Taiwan, comes from two gas fields, in Arun, Aceh, and in Bontang, East Kalimantan.
The Natuna gas project is expected to become the largest gas field in Indonesia. According to official data, the field is estimated to contain 222 trillion cubic feet of natural gas. But only 75 percent of the gas is recoverable because of its high carbon dioxide (CO2) content.
Asked whether the winners of the Natuna gas tender will be those which also have the capability to develop the Membramo hydro electric power in Irian Jaya, Habibie said, "No. They will offered as different projects.
"But there is a technology that will enable us in the future to bring the liquefied CO2 from Natuna to the planned Membramo hydropower plant in Irian Jaya and use it as a raw material for making synthetic gas. The other raw materials, such as oxygen and hydrogen can be produced through the hydropower plant," he said.
He said that the liquefied CO2 can be also used for making steel.
The seminar, which was officially opened by Norwegian Minister of Industry and Energy Jens Stoltenberg and Habibie, was attended by businessmen and scientists of the two countries and continues until tomorrow. (13)