KOGAS, PDPDE Sign MOU to Build Gas Pipelines in Indonesia for $600M

State-owned Korea Gas Corporation (KOGAS), the world's largest liquefied natural gas (LNG) importer with diversified business including overseas gas infrastructure construction, signed a memorandum of understanding (MOU) Monday in Seoul, South Korea with Indonesia’s PT Perusahaan Daerah Pertambangan dan Energi (PDPDE) South Sumatra to build two gas pipelines for $600 million (KRW 706.5 billion) in the Southeast Asian nation, local media BusinessKorea reported Tuesday.

Under the MOU, KOGAS will build a 152 mile- (245 kilometer-) long gas pipeline in South Sumatra and another gas pipeline, measuring 73 miles (118 kilometers) in Bali. The South Korean firm will also provide services to operate and maintain the gas pipelines for 30 years.

KOGAS intends to conduct a feasibility study and evaluate the results before deciding whether to proceed with the gas pipeline project.

The firm hopes the proposed gas pipeline construction project will pave the way for South Korean companies to boost cooperation with the Indonesian authorities and the local industry in the country's future gas infrastructure business -- including areas such as LNG terminal -- particularly in the current bleak market climate.

The MOU was signed by KOGAS President Lee Seung-hoon with PDPDE's President Yaniarsa Hasan in conjunction with Indonesian President Joko Widodo's visit to South Korea.



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