SINGAPORE - Keppel Offshore & Marine has signed an agreement with Pavilion Energy and Indonesia's state-owned PT Perusahaan Listrik Negara (PLN) to explore opportunities in developing small-scale Liquefied Natural Gas (LNG) distribution in West Indonesia.

The signing occurred at the Singapore-Indonesia Leaders' Retreat in Singapore on Thursday (Sept 7).

The agreement follows the discussion between the Indonesia and Singapore governments regarding bilateral energy cooperation during the Singapore-Indonesia Leaders' Retreat in Semarang last year.

A joint feasibility study was subsequently carried out, which identified cost savings and mutual benefits that can arise from collaboration in the small-scale LNG value chain.

Under the agreement, the three companies will tap their combined expertise to distribute LNG in to remote areas in West Indonesia.

LNG can be delivered to floating and onshore terminals using small carriers, where it is regasified and used to generate electricity at PLN power plants.

Keppel O&M chief executive Chris Ong noted that Keppel has almost 30 years of experience in the LNG space and is able to provide cost effective, end-to-end solutions for its customers.