Rekayasa, PAL tie up

NUSA DUA, Bali (JP): State-owned shipbuilding company PT PAL signed a memorandum of understanding on Tuesday with state-owned engineering company PT Rekayasa Industri to cooperate in the production of offshore oil and gas platforms.

PAL president Adwin H said the cooperation agreement was aimed at creating an offshore platform production plant at PAL's shipyard in Surabaya, East Java to compete with foreign producers, who currently dominate the country's platform market.

He said PAL, which in the past specialized in ship-making, expanded its business to also produce oil and gas equipment.

The company needed the engineering skills of Rekayasa Industri to support its expansion plans.

Rekayasa operational director Tony Sulistyo said the offshore platform plant to be established by both companies would help reduce the country's import of capital goods and services.

The producers of offshore platforms in the country include PT McDermott Indonesia, a subsidiary of American firm J Ray McDermott SA, and Nisconi, a subsidiary of Japanese firm Nippon Steel. Both are based on Batam island. (jsk)