Transco I stake sale deadline extended

Transco I stake sale deadline extended

Dow Jones, Singapore

The deadline for bids for a 25 percent to 40 percent stake in
state-owned PT Perusahaan Gas Negara's pipeline developing unit,
Transco I, has been delayed until March 26, six weeks behind
schedule, PGN said Monday.

Transco 1 plans to develop the South Sumatra-Singapore gas
pipeline, which will deliver about US$9 billion worth of natural
gas over 22 years to Singapore starting 2003.

The delay arose as Singapore's PowerGas Ltd.-led consortium
and Korea Gas Corp., or Kogas, requested more time to submit
their final bids, said PGN corporate secretary, Widyatmiko
Bapang.

"Kogas hasn't done its due diligence" for the tender, said
Widyatmiko. He added that some commercial documents weren't made
available to bidders until last week, stalling Powergas's final
bid submission.

The latest deferment in the sale of the Transco I stake could
delay Singapore's import of gas from Indonesia, contractually set
to begin second-half 2003.

Funds from the stake sale will make up a $250 million
shortfall in financing for the pipeline.

The $477-million pipeline project is slated for completion in
August 2003.

The pipeline construction will be partially financed by the
Asian Development Bank, which has committed $88 million in loans
to PGN contingent upon the Transco stake sale.

"Asian Development Bank has agreed to give the approval for
the pipeline tender (award), ahead of the appointment of a
strategic partner in Transco I," said Iwan.

A consortium led by Malaysia's Petroliam Nasional Bhd, or
Petronas, and a partnership between Unocal Corp. and El Paso
Corp. have also submitted bids for a stake in Transco 1.

The Petronas-led consortium includes Singapore Petroleum Co.,
Talisman Energy Inc. and Gulf Indonesia Resources Ltd.. PowerGas,
a unit of Singapore Power, will bid together with Williams Co.
and Indonesian pipeline developer, PT Trans Nusantara Multi
Construction, or Tranaco.