LNG firm asks for governor's help mediating land acquisition
Ruslan Sangaji, The Jakarta Post, Palu | Sat, 04/04/2009 2:02 PM
A liquid natural gas (LNG) producer in Central Sulawesi has requested help from the provincial administration to arbitrate a stalled land purchasing process for its refinery in Banggai regency.
"We have sent a letter to the governor and regent on March 16. We are requesting their assistance, as landowners have demanded unreasonable prices for the purchase of their land," PT Donggi Senoro LNG (DSL) general affairs manager Julian Sudarmonegoro told The Jakarta Post on Thursday.
He said his company had turned to the administration for help because negotiations between the company and landowners had reached a deadlock. He expressed hope Governor HB Paliudju and Banggai Regent Ma'mun Amir would mediate the land acquisition process to ensure the Rp 31 trillion oil and gas investment would run smoothly.
Julian said construction of the fourth LNG plant in Indonesia would be delayed because 3 percent of the 350 hectares of land required by the company in Uso village, Batui district, Banggai, had not been secured.
He added around 17 landowners had asked for prices the company deemed too high. The landowners quoted between Rp 2 billion and Rp 5 billion for a hectare of land.
PT DSL rejected the price, offering to pay Rp 90 million per hectare of land located more than 100 meters off the Trans Sulawesi highway, and Rp 125 million per hectare of land along the highway.
Wimbo Haryono Sunoko, head of the Central Sulawesi provincial secretariat's administrative affairs office, who handles land purchases, said his office had not yet received the letter sent by PT DS.
Meanwhile, the secretariat's spokesman Irwan Lahace said the governor's recent visit to Banggai regency on April 1 had nothing to do with PT DSL's land acquisition efforts for its LNG plant.
Other hiccups in the project include construction delays caused by gas price re-negotiations between the operator and suppliers and the ensuing increase in the cost of building.
PT DSL is owned by a consortium made up of state oil and gas company Pertamina, Mitsubishi Corp. and PT Medco E&P. PT Medco E&P is expected to start building the LNG plant this year
