Consortium to tender Palapa Ring network procurement

The Jakarta Post, Jakarta

A consortium commissioned to develop the Palapa Ring fiber-optic network expects to launch bidding registration February for the project's procurement, an official says.

"We are about to finish the terms and conditions for the procurement and are hoping to invite bidders mid February," consortium spokesperson Rakhmat Junaidi said here on Tuesday.

He said the consortium management committee hoped to determine the winners by May at the latest, giving them time to conduct feasibility studies before beginning construction in the third quarter of this year.

The Palapa Ring is an ambitious project which aims to link Sumatra, Java, Kalimantan, Nusa Tenggara, Sulawesi, Maluku and Papua and eight existing network connections or backhauls through an estimated total 35,280 kilometers of undersea and 21,870 kilometers of underground fiber-optic cable.

The bidding is expected to only cover the construction of 9,345 kilometers of undersea and 857 kilometers of underground fiber-optic cables in the eastern part of the archipelago.

"We expect to finish the construction of the eastern section in 2011," he said.

First announced to the general public in January 2005 during the first Indonesia Infrastructure Summit in Jakarta, the project is part of the government's program to increase telecommunication penetration throughout Indonesia -- presently reaching only 20 percent of the population.

The consortium, established Nov. 10, includes PT Telkom, PT Indosat, PT Exelcomindo Pratama, PT Bakrie Telecom, PT Infokom Elektrindo and PT Powertek Utama Internusa.

Under an agreement with the government, the consortium were commissioned to finance the construction of the project in the eastern part of the archipelago, with an estimated project cost of around US$225.037 million.

Rakhmat said the six members were ready to secure their own budgets to finance the project, of which 40 percent should come from the state telecommunication company, Telkom.

Telkom vice president for public and marketing communications Eddy Kurnia said earlier that the project would give a strategic value to the company and its subsidiaries, because it laid down important infrastructure to strengthen telecommunication services in the eastern part of Indonesia.

The development of the fiber-optic network in Western Indonesia has been sporadic because telecommunication operators and institutions have not integrated their networks, resulting in higher costs for telecommunications including the Internet access.

Through the Palapa Ring project, the government expects to integrate the fiber-optic network in Western Indonesia with the project in Eastern Indonesia so that the interconnecting networks span from Sumatra to Papua. (ind)