Get Rp. 4.4 T, PGN Geber the Rokan Oil Pipe Project

Jakarta, CNBC Indonesia – PT Perusahaan Gas Negara Tbk (PGAS) or PGN is committed to completing the construction of the Rokan Oil Pipe in order to boost the efficiency of Indonesia’s energy budget, in line with the government’s efforts to reduce oil imports.

“In principle, the construction of the Rokan Oil Pipe is an effort to boost the efficiency of the energy budget in Indonesia,” said PGN President Director Suko Hartono, in a press release on Sunday (18/10/2020).

He said that the capital expenditure (capex) value of US $ 300 million or equivalent to Rp 4.44 trillion (exchange rate of Rp. 14,800 / US $), the efficiency optimization obtained is US $ 150 million or around Rp. 2.1 trillion, because allocation value capex initially amounting to US $ 450 million.

This project was built to maintain the resilience of energy production after transferring management of the Rokan Hulu Block from PT Chevron Pacific Indonesia (CPI) in 2021.

“The PGN group as Pertamina’s gas subholding is committed to be part of the solution for the fulfillment of national energy. With our competence in developing oil and gas infrastructure and distributing natural gas energy to all sectors,” he said.

“We are trying to improve the effectiveness and efficiency of the entire energy supply chain. In addition, the implementation of investment operations is always aimed at moving the wheels of the regional and national economy, especially in the current very challenging times of economic recovery during the pandemic,” said Suko.

He said the company is committed to providing the best support for the Oil and Gas Holding of PT Pertamina (Persero) so that the transition process for the management of the Rokan Block runs smoothly and can increase the achievement of financing efficiency in the implementation of the Rokan oil pipeline National Strategic Project.

In the construction of the Rokan Oil Transmission Pipe, PGN is targeting to have a positive impact on regional development.

This is because the development of this national strategic project involves more than 60% of the scope of construction and local manpower.

“With a development involving local resources, it is hoped that the multiplier effect will be able to contribute significantly to increasing human resource capacity and transfer of knowledge in the regions,” said Suko.

According to Suko, empowering local entrepreneurs and workers also supports the economic empowerment of local communities during times of crisis. From the knowledge transfer that will occur later, it can provide benefits in human resource management, especially in the aspects of technological and commercial understanding in the construction of the Rokan Oil Pipe.

“The construction of the Rokan Oil Pipeline project is a strategic project that is full of risks and costs a lot, so it requires increased mastery of technology and a good understanding of the commercial aspects. These two aspects are the main benchmarks, so that the results can be optimal and provide broad benefits,” Suko added.

Through PT Pertagas as the executor of the construction, cooperation has been made in the procurement of steel pipe material for the Rokan Oil Pipe with PT Krakatau Steel.

From this cooperation, it is targeted to reduce the cost of material procurement by 16% and provide added value to the domestic steel industry because it is an effort to increase the use of domestic products (P3DN).

Previously in 2018, the Ministry of Energy and Mineral Resources (ESDM) decided that Pertamina would manage the Rokan Block, Riau, after winning the tender with CPI.

Thus, the management of Pertamina in the Rokan Block marked the end of CPI management in Rokan for more than half a century.

[Gambas:Video CNBC]

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