PGN's net profits surge 376 percent to Rp 433 billion
JAKARTA (JP): Gas distribution company PT Perusahaan Gas Negara (PGN) said on Friday its unaudited net profits increased by 376 percent to Rp 433.1 billion (US$57.7 million) last year from Rp 90.9 billion in 1998, despite the lingering economic crisis.
Company president Abdul Qoyum Tjandranegera told reporters the significant rise in profits was mainly due to growth in its dollar revenue from natural gas distribution from gas fields in Grissik, South Sumatra to the oil fields in Duri, Riau.
PGN has been operating a 544-kilometer gas pipeline -- the country's longest -- to transport 310,000 million cubic feet per day (MMCFD) of natural gas from the gas fields owned by Canadian company Gulf Resources in Grissik to the oil field of American oil and gas company PT Caltex Pacific Indonesia since October 1998.
In Duri, Caltex uses the gas to pump the Duri oil wells.
PGN receives 62 U.S. cents per million British thermal unit (MMBTU) in transportation fees from Gulf.
"PGN has successfully gotten out of the economic crisis," Qoyum said after a ceremony to install 12 division heads of the company.
Qoyum said PGN's unaudited sales increased by 46 percent to Rp 2.02 trillion last year from Rp 1.38 trillion in 1998, while its assets rose to Rp 3.18 trillion in 1999, from Rp 2.78 trillion in 1998.
Aside from transporting the natural gas of other companies, the company is also active in selling its own natural gas on the domestic market, both to industries and households. It buys the gas from state oil and gas company PT Pertamina and its contractors. It mostly sells its natural gas in rupiah.
According to Qoyum, the company's own gas sales rose 4 percent to 158.1 MMCFD in volume last year, from 152 MMCFD the previous year.
The quantity of gas of other companies transported by PGN reached 350.6 MMCFD last year, a 226 percent increase from 107.6 percent in the previous year.
Qoyum also said PGN was preparing two giant pipeline projects which would link Sumatra with Singapore and Sumatra with Java respectively.
The first pipeline project, which would stretch from Grissik to Singapore, passing Sakernan in Jambi and Batam island, would be built with a total investment of $370 million, mostly provided by the Asian Development Bank.
The 521-kilometer pipeline, some of which will be underwater, will transmit 400 MMCFD of natural gas from gas fields in South Sumatra and Central Sumatra to industries in Batam and Singapore, starting in 2002.
Qoyum said the government would receive dollar earnings amounting to $396 million per year from the gas sales.
The second pipeline project linking South Sumatra and Cilegon in West Java will be built with an investment of $580 million.
PGN will use the 546-kilometer pipeline to transport up to 600 MMCFD of natural gas from South Sumatra to industries in West Java.
PGN expects the Japanese government to provide loans under the special yen loan program to finance the South Sumatra-West Java pipelines.
The Japanese government has prepared a multibillion special yen loan program to help Asian countries devastated by the economic crisis rebuild their infrastructure.
Qoyum estimated the use of gas, rather than diesel oil by industries in West Java, would enable the government to save up to Rp 3.8 trillion in fuel subsidies per year. (jsk)