Kogas and PDPDE sign $600m gas pipelines construction deal

Liquefied natural gas (LNG) importer Korea Gas (Kogas) and Perusahaan Daerah Pertambangan dan Energi (PDPDE) in Indonesia have signed a memorandum of understanding (MoU) for the construction of two gas pipelines for $600m.

Under the MoU terms, Kogas will build, own and operate the 363km long gas pipelines.

The first pipeline to be built will be a 245km long gas pipeline in South Sumatra.

Another gas pipeline is planned to be constructed in Bali and will measure 118km.

Prior to proceeding with the project, a feasibility study will be carried out by Kogas, which would later on assess the results.

With plans for the new pipeline construction project, companies in South Korea are expected to increase their cooperation with the Indonesian authorities, as well as the local industry, BusinessKorea reported.

In April this year, Kogas had signed an MoU with French company Total to reinforce mutual cooperation in a bid to explore opportunities throughout the LNG value chain.

The agreement was signed during the LNG 18 conference in Perth, Australia, and its main purpose is to identify and pursue opportunities to develop the LNG market in Asia together.

The agreement was also aimed at identifying opportunities in new importing countries and to extend cooperation in LNG trading and terminal optimisation.