Optimization of Gas Pipeline Utilization for Section 2 Pemping-Tanjung Uncang With the Provision of Mini LNG Plant for Karimun Regency

Abstract

Investment evaluation is a crucial part of investment decisions to measure will the project generate profit for the company. There is four Capital Budgeting technique used to measure this investment evaluation in this project Net Present Value (NPV), Internal Rate Return (IRR), Discounted Probability Index (DPI), and Payback Period (PBP). From the evaluation, it was obtained that a positive NPV of 280.649, an IRR of 8,10% greater than the WACC of 4,21%, while the DPI of 1.25 and PBP of 3,25 years was faster than the duration of the 5 (five) year contract. Monte Carlo simulation used 1.000 times to calculate Probability NPV<0 with result Probability NPV<0 in this project is 0,17% meanwhile probability NPV>0 is 99,83%.In the sensitivity analysis, it is found that the increase in the cost of capital and the duration of the agreement are factors that are sensitive to project feasibility. From the results of the above calculations, it can be concluded that Optimization Of Gas Pipeline Utilization For Section 2 Pemping – Tanjung Uncang With The Provision Of Mini LNG Plant For Karimun Regency is Eligible to be accepted.