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Pertamina pipelines blocking Cilamaya port development

Pertamina pipelines blocking Cilamaya port development
Typical Indonesian bureaucratic logjam is stymieing attempts to help alleviate congestion at West Java's main Tanjung Priok port with an alternative port of Cilamaya, local reports said.

Progress on building the port, originally set to be operational by 2017, has been blocked by Pertamina's oil and gas pipelines in the area which supply key industrial estates in the Greater Jakarta area.

Indonesia's state energy company transports some 40,000 barrels of oil and 190m cubic feet of gas per day through its pipelines. It claims the oil is vital to supply power plants in the Greater Jakarta area while the gas feeds a major fertiliser plant.

The Cilamaya port was supposed to ease congestion at Tanjung Priok port in North Jakarta and to support the nearby Karawang industrial areas, where several Japanese companies, including Toyota Motor Manufacturing Indonesia (TMMI) and Honda Prospect Motor, have their manufacturing plants.

“This is why we must discuss the matter thoroughly. I have asked a team to study the project with Pertamina,” economy minister Hatta Rajasa, was quoted as saying.

He was still confident that the project would start soon, reports said, while other other government officials were quoted as saying "a study" was underway to find a solution to the pipeline issue.

Cilamaya Seaport is one of the flagship projects in Indonesian president Susilo Bambang Yudhoyono’s MP3EI economic development master plan. Indonesia is due for a presidential election this year.

The Japanese government has pledged financial help for the estimated IDR10trn ($878.5m) Cilamaya project.

Many Japanese firms have plants in the Karawang area about 45km southwest of the proposed port. They are now reliant on the already overloaded Tanjung Priok port to the northwest.

TAGS: Ports