Megawati to launch major oil, gas projects

Megawati to launch major oil, gas projects

Fitri Wulandari, The Jakarta Post, Jakarta

President Megawati Soekarnoputri is set to launch 14 oil and
gas projects worth US$1.9 billion, signaling an improved
investment climate in the sector.

Four of the projects have been completed, while the other 10
will start development soon.

The projects consist of 12 projects worth $940 million owned
by state oil and gas firm Pertamina, one worth $485 million owned
by state gas distribution firm PT Perusahaan Gas Nasional (PGN)
and one worth $551 million owned by oil and gas upstream
authority BP Migas and French oil and gas company Total E&P
Indonesie.

"The projects are a milestone to increase investment in the
oil and gas sector. They are expected to improve investor
confidence that the investment climate in the sector is still
good," Minister of Energy and Mineral Resources Purnomo
Yusgiantoro told a media briefing on Wednesday.

Purnomo added the projects could eventually boost the
country's growth by "increasing revenue, boosting the economy in
the regions and producing environmentally friendly oil and gas."

Megawati is scheduled to launch the projects at the Balongan
oil refinery in Indramayu, West Java, on Sept. 14.

Four projects that have been completed are: Cemara mini
liquefied petroleum gas (LPG) refinery, Indramayu; East Limau LPG
mini-refinery, South Sumatra; the CO2 removal facility in Subang,
West Java; and the compression facility of the Tunu gas fields in
East Kalimantan.

The first three are owned by Pertamina, while the other is a
joint project of BP Migas and Total E&P Indonesie.

Pertamina director for downstream oil and gas business Muchsin
Bahar said the LPG projects were meant to reduce Pertamina's
dependence on LPG imports.

Muchsin said the projects were to anticipate increasing
demands for LPG in the future.

LPG is widely used by middle- and high-income households
nationwide, with consumption reaching about one million metric
tons per year. In Jakarta alone, some 200,000 households use LPG.

The ten projects, whose development will be launched by the
President, include Pertamina's Plaju liquefied natural gas (LNG)
plant in South Sumatra, Pertamina's unleaded gasoline plant at
the Balongan refinery, PGN's gas pipeline transmission from
Pagardewa, South Sumatra to Cilegon, West Java, and the
procurement of two oil tankers owned by Pertamina. The 260,000
deadweight ton (dwt) tankers, categorized as very large crude
carriers (VLCCs), each have a capacity of two million barrels of
oil.