Pertamina seals $310m in syndicated loans

The Jakarta Post , Jakarta

State oil and gas company PT Pertamina has secured syndicated loans worth US$310 million from a group of global investors, including banks, to finance the development of its gas plants in South Sumatra.

"Some 70 percent of the total loans are coming from the Mitsubishi Corporation consortium, which groups together, among other corporations, Mitsui & Co. and Sumitomo," Pertamina spokesman M. Harun said on Thursday, as reported by Antara.

The remaining 30 percent come from a group of commercial banks, such as BNP Paribas, Bank of Tokyo-Mitsubishi, Mizuno Corporate Bank and ING Bank NV.

The official signing of the loans took place on Jan. 6, Harun said.

The loans would be used to finance the completion of a gas compression facility in the Musi Barat plant, the construction of transmission pipelines from Musi Barat to the Pagardewa plant, the construction of a gas compression facility in the Merbau plant and transmission pipelines from Merbau to Pagardewa.

Those projects, first started in 2002, are expected to enable Pertamina to supply gas to West Java of up to 250 million cubic feet per day.

The first delivery could take place sometime in 2006.

Harun said the loans were a reflection of investor confidence in the company's business outlook, as well as the country's economic prospects.

Indonesia has been striving to gradually reduce its dependency on oil, having seen its oil output declining over the past decade.