Gas Negara to complete $1.1b pipeline project

JAKARTA (JP): State-owned gas company PT Gas Negara will complete 1,040 kilometers of natural gas pipelines worth US$1.1 billion in Sumatra by 2000.

The company's president, Qoyum Tjandranegara, said the first pipeline, spanning 540 kms from southern to central Sumatra, is financed by a $470 million loan from the Asian Development Bank and a $120 million syndicated loan led by the European Investment Bank.

"The second pipeline project covering 500 kms from the southern part of Sumatra to West Java is financed by a $300 million loan from the World Bank and another $300 million loan from our strategic partner," he told reporters on Thursday evening.

He said that the company is now selecting several foreign companies to become strategic partners.

The coordinator of Gas Negara's Trans Indonesia Gas Pipeline Project, Nursubagjo Prijono, said that four companies -- Navacorp of Canada, British Gas, Gas du France and Technicorp of United States -- had applied to become partners.

"We are now evaluating the financial and technical ability of the companies," he said, adding that the selected partners would become shareholders in the new company to be set up to manage the pipeline.

Qoyum said that the 540 km Asamera-Duri-Batam pipeline would be completed in October 1997.

The second project, scheduled to be completed in 2000, will connect the gas pipeline in Cilegon, West Java, with Asamera. It will run 500 kms, he said.

"The two projects are part of the planned Indonesian integrated gas pipeline system," he added.

He said that the integrated pipeline system will span 2,195 kms from Riau in central Sumatra to Porong in East Java. Its is scheduled to be completed by 2006. (04)