Indonesian gas distribution and transmission company PGN has announced its plans to invest US$1.25bn in 2014. Half of the investment (US$650m) will be dedicated to the acquisition of a 75% stake in Ujung Pangkah block in East Java from Hess (US); PGN will reach 100% of the block through its subsidiary PT Saka Energi Indonesia. PGN also plans to invest US$400m in the development of a floating storage and regasification unit (FSRU) in Lampung and US$200m will be directed to distribution and transmission development.
PGN is increasingly active in the upstream business, with the recent acquisitions of a 20% participating interest in the Ketapang PSC gas block in East Java from Sierra Oil Services; the company is also considering acquiring two additional blocks. Meanwhile, PGN is facing difficulties, as oil and gas production company Pertamina is seeking to acquire the gas distribution company, which would be merged with its own distribution company PT Pertamina Gas (Pertagas).