As foreshadowed by EnergyReview.net last Thursday, Indonesian President Megawati Sukarnoputri this week officially inaugurated a $US420 million natural gas pipeline from Indonesia's Sumatra island to Singapore.
The 470km pipeline will supply gas from fields in Sumatra to Singapore gas and power utilities and buyers in Batam for 20 years, initially operating at 150 million cubic feet per day before building to 350 million cubic feet per day by 2009.
At the inauguration, Singapore Prime Minister Goh Chok Thong said the project was a vital step for the Trans-Asean Gas Pipeline project, which has been designed to provide greater security and sustainability in energy supplies for the region.
Aside from the Natuna islands in the South China Sea, Sumatra is projected to become the main source of gas for the Trans-Asean project. Natural gas is already piped into Singapore from gas fields in West Natuna through a 640km pipeline launched two years ago.
Gas for the Indonesia-Singapore pipeline will be supplied from the Jabung Bloc run by PetroChina and the South Jambi Bloc and Corridor Bloc, both run by ConocoPhilips, in the Indonesian province of South Sumatra.
From Grissik, the pipeline goes onshore for 135km to Sakernan in Jambi province before heading to the sea 120km away and connecting with a 215km offshore pipeline to Batam. A 50km then pipeline links Batam to Singapore.
PGN, operator of the line, said the new pipeline has the ability generate $US700 million a year in revenue for Indonesia.
The Asian Development Bank provided $US88 million and the European Investment Bank $US112 million towards the cost of the pipeline, with the rest coming from internal funds PGN said.
