Pertamina, PGN to build LNG terminals separately

Alfian ,  The Jakarta Post ,  Jakarta   |  Fri, 07/03/2009 2:56 PM  |  Business

In a bid to accelerate the development of liquefied natural gas terminals, state energy companies PT Pertamina and PT Perusahaan Gas Negara (PGN) - which earlier planned to jointly build two floating LNG terminals - have now decided to work separately.

Pertamina's president director Karen Agustiawan said on Thursday that her company and PGN would finish the projects in West Java and in North Sumatra faster if the two worked separately.

"Initially we were asked to finish the projects within three years, but later on we were told that the projects must be completed within two years," Karen said, adding that the process would be more effective in terms of decision making should the two companies work separately.

She continued: "As the consortium *Pertamina and PGN* was asked to build another LNG terminal in Medan, we then decided in our last meeting that Pertamina and PGN will share the jobs."

Pertamina would focus on terminal construction in West Java, while PGN will develop the North Sumatra terminal, said Karen.

The government intended to build an LNG floating terminal in Jakarta Bay, West Java, and in Belawan, North Sumatera to anticipate gas shortages in gas-fired power plants.

"In the mid term, we estimate gas shortages will occur in West Java and in North Sumatra," Energi and Mineral Resources Ministry Purnomo Yusgiantoro said on March 30.

The terminal in West Java will be able to process between 200 and 400 million metric standard cubic feet per day (MMSCFD), while the terminal in Belawan will handle between 100 and 150 MMSCFD.

Karen said Pertamina still helped calculate required investment for both terminals, being built to supply gas for power plants operated by state electricity firm PT PLN.

The West Java terminal will supply gas for the Tanjung Priok and the Muara Karang power plants, while that in North Sumatra will supply gas to the Belawan power plant.

Karen said that the terminal construction (alone) would only take eight months, but the process of appointing consultants (and contractors) might be time consuming.

"Now, we are in the process of looking for the consultants," Karen said.

She added that although Pertamina and PGN would work separately in building the two terminals, both companies could help operate each other's project once completed.

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