[Nasional-e] BP may shut Indonesian gas field due to potentially deadly pipeline rupture

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http://www.ananova.com/business/story/sm_682809.html?menu=business.latestheadlines

BP may shut Indonesian gas field due to potentially deadly pipeline rupture

BP Indonesia said it may have to shutdown production at its Pagerungan gas 
field due to a potentially deadly rupture in a 440-kilometre long pipeline 
carrying gas from the field to East Java.

The field is the only supplier to the East Java pipeline, which is owned and 
operated by state oil and gas company Pertamina and delivers gas to three 
customers: the state-owned electricity and gas companies, PLN and PGN, and 
fertiliser company PKG. The 28-inch pipeline has carrying capacity of 600 
million cubic feet of gas per day.

A BP spokesperson could not immediately say how much a shutdown would cost 
the company. Daily production at the field is around 200 million cubic feet 
of gas per day.

BP said the pipeline carries a "risk of failure well beyond any 
international standards" due to excessive free span lengths in the undersea 
section and erosion in the sand bed caused by strong currents.

"In the event of pipeline failure there is a risk of loss of life due to 
fire and explosion or sinking of a vessel passing over the pipeline rupture 
point," the company said.

In a bid to avoid such a tragedy, the government has agreed to set up a 
maritime exclusion zone measuring 4 nautical miles wide and 40 nautical 
miles long, south of Pulau Raas and Pulau Kangean off the East Java coast.

The Indonesian navy will patrol and enforce the exclusion zone with 
immediate effect. Notices have been sent to all mariners warning them to 
avoid the area.

However, BP said if the exclusion zone fails to divert marine traffic from 
the area, the company will have to stop producing gas at the Pagerungan 
field to block supply to the pipeline in the name of public safety.

BP operates the field through its 100%-owned subsidiary, BP Kangean, in a 
production sharing contract with Pertamina.

© AFX News


Story filed: 11:10 Wednesday 2nd October 2002



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