State gas distributor PT PGN expects the cost of two new pipelines connecting gas-rich South Sumatra and densely populated western Java to be 11 percent higher than initial estimates, a top executive says.

The cost of the project will rise because PGN has to build an additional segment of pipeline between Muara Bekasi and Muara Tawar in West Java, PGN president director WMP Simanjuntak said Monday.

Funds from PGN, plus a US$225 million loan from the Asian Development Bank, which will come through in April, will still be enough to cover the costs of the project, Simanjuntak said.

"We don't need to look for additional loans," said Simanjuntak.

The two pipelines, which will span a total of 1,106 kilometers with the capacity to transport 950 million standard cubic feet per day, were initially expected to cost $1.1 billion.

The pipeline linking Grissik to Rawa Maju in West Java is expected to begin flowing in October this year. The pipeline between Pagardewa in South Sumatra and Cilegon in Banten should be completed by February 2007.

Simanjuntak said last year that when the pipelines opened, the company would see revenue in 2007 triple from the Rp 4.4 trillion ($475 million) recorded in 2004.