"It is around 16 to 20 cargoes per year to start in 2014."
Seoul (ANTARA News) - Construction of Lampung`s floating storage and regasification unit (FSRU) by Hyundai Heavy Industries Co Ltd is expected to be completed in mid 2014.

The facility is being built by Hyundai in the complex of the Korean shipbuilding giant in Ulsan, Deputy Minister for Energy and Mineral Resources Susilo Siswoutomo said here on Thursday.

The Lampung FSRU, which will have a storage capacity of 170,000 cubic meters of gas with a supplying capacity of 240 million cubic feet per day is owned by Norway`s Hoegh LNG Ltd and Indonesia`s PT Rekayasa Industri.

State gas distributor Perusahaan Gas Negara (PGN) will lease the facility from Hoegh LNG Ltd and Rekayasa Industri for 20 years at US$140,000 per day.

PGN will also need to invest around US$400 million including US$104 million to build mooring system, US$150 million for off-take station and pipeline and the rest for preparation.

Susilo said the government will guarantee supply of gas in liquefied natural gas (LNG) to the facility either from Bontang LNG plant in East Kalimantan or Tangguh LNG plants in Papua.

The government will certainly give priority in LNG supply for Lampung FSRU as its construction is already in progress, he said here on Thursday after attending a keel laying ceremony marking the start of the construction of the facility

Deputy chief of the Executive Unit of Upstream Oil and Gas (SKK Migas) J Widjanarko, who accompanies Susilo in the ceremony, said PGN will have supply from Tangguh of LNG formerly for export to US company Sempra.

"It is around 16 to 20 cargoes per year to start in 2014," Widjanarko said . A cargo of LNG is around 55,000 tons.

PGN could also consider the option of LNG imports if the prices of imports are cheaper to feed the FSRU, he said.

PGN, therefore, has to secure gas sales agreement (GSA) with the operator of Tangguh BP Berau Ltd, he said.

A PGN Director Jobi Triananda Hasjim said PGN already signed the FSRU leasing contract with Hoegh LNG Ltd, and it has started construction of supporting facilities including mooring system, off take station, onshore receiving facilities and pipeline.

"With keel laying has been done, PGN is optimistic the FSRU could start operation as scheduled in June or July in 2014," Jobi said.

The gas from the FSRU would be for use by consumers including industries in Lampung and western part of Java supplied through a transmission pipeline , the South Sumatra-West Java (SSWJ) Transmission Pipeline.

PGN will build a 21 kilometer pipeline to link the FSRU and Labuhan Maringgai in Lampung.

Before the FSRU is in operation, PGN will also build distribution pipelines totaling 88 kilometers in Lampung and other infrastructure .

In 2012, PGN already had 89,000 consumers using 806 MMSCFD all over the country , up from 795 MMSCFD in 2011.

Industries account for 90 percent of its gas consumption.
(Uu.AS/H-ASG/F001)

Editor: Priyambodo RH
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