State firm takes over Migas Center project

JAKARTA (JP): PT Pembangunan Perumahan, a state-owned property developer, will take over the US$153 million Migas Center building project after the government terminated PT Petrobuild Indonesia's build-operate-transfer agreement.

President of Pembangunan Perumahan Daryanto said yesterday his company had formally received the government's offer to continue the construction of the 32-story building.

"We will resume the delayed project after the government has cleared its dispute with the former developer," he was quoted by Antara as saying following his meeting with Minister of Mines and Energy I.B. Sudjana.

The government last year canceled Petrobuild's contract to develop the Migas Center, a building for oil and gas companies, on Jl. Thamrin.

The contract was terminated after Petrobuild failed to finance the construction works according to schedule.

The construction of the building at the site of the former office of the oil and natural gas directorate general was initially scheduled for completion in March next year.

The Ministry of Mines and Energy recently established a consortium of the Pertamina employees' welfare foundations and Pertamina's pension funds to take over the project from Petrobuild.

Consortium

Daryanto said the Ministry of Mines and Energy had also asked his company to join the consortium.

Petrobuild had sub-contracted PT Ballast Indonesia to help construct the building.

Ballast Indonesia's President Dewi Soeprapto Ongko also asked the government to clarify the project's status and its dispute with the former developer.

"It is important for us because we have spent more than Rp 25 billion on the piling works for the project," she said, adding that Petrobuild had paid less than a half of its bill.

The plan to develop a representative oil and gas center to house the offices of oil companies and the oil and gas directorate general was conceived in the 1980s.

But the idea only developed into a concrete project in early 1993 with the full support of the then Minister of Mines and Energy Ginandjar Kartasasmita, who witnessed Petrobuild's contract with the government.

According to earlier reports, Petrobuild did not want its contract terminated, claiming the government's decision to cancel the deal was unfair.

The company said it would not be compensated for the money it had invested in the project, including the rent it paid for the temporary offices for the directorate general's staff. (hen)