TEMPO.CO, Jakarta - Deputy Minister of Energy and Mineral Resources Arcandra Tahar has inaugurated the groundbreaking marking the start of construction of a 64 kilometer gas pipe project between Duri and Dumai in Riau.
The gas transmission pipe project, estimated to cost US$52.2 million, is owned by Pertagas, a subsidiary of state-owned oil and gas company PT Pertamina.
Arcandra said the transmission pipe will channel gas from the Duri gas field to a refinery of Pertamina in Dumai and other industries in Riau.
"In term of capital expenditure it is not very big but the impact is very helpful in gas distribution in Dumai and Riau," he said in a video conference in Monday.
He said the development and operation of the gas pipe is a realization of synergy between state companies between Pertamina and PT Perusahaan Gas Negara (PGN).
On Friday last week PGN and Pertagas signed an operation cooperation agreement (KSO) in the development of the Duri-Dumai gas pipe . Under the KSO, PGN has a 40 percent stake in the project with Pertagas holding the remaining 60 percent.
The gas will be supplied from the Corridor Block of Conoco Phillips), Bentu Block of Energi Mega Persada (EMP), Jambi Merang Block of (JOB Pertamina-Talisman).
The two state companies will invest around US$52.2 million in the gas pipe project which will employ up to 400 people during construction.
The construction is to be completed in 11 months to be operational in October 2018.
The gas pipe will supply gas for Pertamina's oil refinery in Dumai, Dumai sea port, petrochemical industry and otyher industries in Riau.
The oil refinery of Dumai will use the gas for fuel to substitute oil fuel. The refinery needs gas around 57 million MMSCFD to rise later by phases to 120 MMSCFD.
Pertagas start work by welding at the oil refinery in Dumai on Monday.
ANTARA
