Gas Negara, Brighton sign $1.3 billion deal
Gas Negara, Brighton sign $1.3 billion deal
JAKARTA (JP): The state-owned gas company PT Gas Negara (PGN) signed a 20-year agreement worth US$1.3 billion with Brighton Ltd. yesterday to supply 60,000 standard cubic feet of gas per day to Brighton's 600-megawatt steam power project in Batam, Riau.
PGN's president, A. Qoyum Tjandranegara, said the gas will be delivered by PGN through the Asamera-Duri-Batam pipeline which will span 820 kilometers (km) from central Sumatra to Batam.
"The pipeline is scheduled to be completed in 1998," Qoyum told reporters after the signing ceremony here.
Brighton, which is registered in Western Samoa, and its local partner, PT Kresna Tara, will initially build a 150-megawatt power plant with an investment of $100 million.
Both Brighton and Kresna Tara are 55 percent owned by Bambang Trihatmodjo. The remaining 45 percent is equally owned by three other Indonesian businessmen -- Johanes Kotjo, Bambang Riyadi Soegama and Wisnu Suhardono.
Bambang Riyadi Soegama said the planned power plant's capacity will eventually be expanded to 600 megawatts with an additional investment of $500 million.
He said the construction of the power plant will start in 1998. It is slated to come on stream in 1999 to supply Batam and its surrounding areas.
He said the electricity generated by the power plant will be sold to the state-owned electricity company PT PLN at an estimated price of six U.S. cents per kilowatt hour.
He added that his company has yet to sign a power purchasing agreement with PLN, but that Brighton has secured a letter of preliminary approval from the Director General of Electricity and Energy Development for the power project.
Qoyum said yesterday that the $600 million Asamera-Duri-Batam pipeline will be 75 percent financed by the Asian Development Bank, the European Investment Bank and Japan's Export Import Bank.
"The remainder will be financed by new shareholders which will be selected in April," he said.
He said four companies -- Navacorp of Canada, British Gas, Gas Du France and Technicorp of the United States -- had applied to become shareholders in the pipeline project.
Qoyum said PGN will buy natural gas for the power plant from Pertamina and its contractors in central Sumatra, but a final gas purchase contract with Pertamina has yet to be concluded. (04)