SINGAPORE (Jan 14): Pipenet, a wholly-owned subsidiary of Keppel Infrastructure Holdings, has secured a $40 million contract from JTC Corporation to design, build and operate pipe racks on Jurong Island.

Under the terms of the contract, Pipenet will construct pipe racks along parts of Banyan Drive, Banyan Avenue and the Jurong Island Highway that will facilitate pipeline connection to the Jurong Rock Caverns.

The project is slated to complete by 2020 and will be operated by Pipenet for 15 years, with JTC having the option to extend for another 15 years.

Pipenet currently owns and operates an extensive pipeline corridor network on Jurong Island, with the majority stretch of it running along the Jurong Island Highway. It also provides pipe corridor rental services to companies with the need to transport chemical feedstock and products on the island.

The existing corridor connects the Merbau region to the Banyan and Tembusu regions on Jurong Island, and runs through the chemical cluster at the Sakra region.

According to Keppel, customers using this service corridor would be able to reduce initial start-up costs, optimise land usage and lower transportation costs of raw materials and products.

The group does not expect its latest contract win to have a material impact on its earnings per share (EPS) and net tangible assets (NTA) per share for the current financial year ending Dec 2019.

Shares in Keppel last closed 3 cents higher at $6.25.