Indonesian Gas Firm PGN to Double Capex to $1.2B for 2014
JAKARTA, Feb 6 (Reuters) - Indonesian gas utility firm Perusahaan Gas Negara (PGN) said on Thursday it plans to more than double its capital expenditure to 15 trillion rupiah ($1.2 billion) this year to build infrastructure and finance its acquisitions.
The company bought a 75 percent stake worth $650 million in East Java's Ujung Pangkah block from U.S. oil and gas producer Hess Corp in January, and will soon announce the acquisition of another block in Indonesia, President Director Hendi Prio Santoso told reporters.
PGN will fund its spending through internal cash and loans, Santoso said, declining to give more details on its planned acquisition. The company is also targeting a 5-10 percent growth in sales volume this year, Director Wahid Sutopo said.
PGN's future was thrown into question after Indonesian state-owned enterprises minister Dahlan Iskan last month proposed an acquisition of the gas utility firm by state energy company Pertamina.
But PGN shares recovered slightly after reports said the Indonesian parliament had rejected the proposed acquisition on concerns that it was too rushed and Pertamina already had a huge task handling its current assets.
"We will continue building our infrastructure, unaffected by that issue (Pertamina's acquisition plan)," Santoso said. ($1 = 12,192.50 rupiah)
(Reporting by Fathiyah Dahrul, Writing by Eveline Danubrata; Editing by Himani Sarkar)
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