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12 domestic gas sales contracts signed
Domestic demand for natural gas has sharply increased as government boosts gas utilization projects, with the latest signing of 12 natural gas sales agreements between state oil and gas company Pertamina and its business partners on Tuesday
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Domestic demand for natural gas has sharply increased as government boosts gas utilization projects, with the latest signing of 12 natural gas sales agreements between state oil and gas company Pertamina and its business partners on Tuesday.
BP Migas deputy chairman for financial economy and marketing Djoko Harsono said demand for natural gas would continue to increase between 7 to 8 percent per year.
“Demand has sharply increased in the latest five years. We predict demand would be 4.2 billion cubic feet (BCF) per day in 2014,” he said.
At present the daily consumption of the gas is 2.8 billion BCF, so the industry expects major expansion.
The government focus on increased use of natural gas is to help reduce the use of fossil fuel and reduce the burden of fuel subsidies on the state budget.
BP Migas mentioned at the same time in a related press release the importance of the kerosene-to-LPG conversion program, which is also helping to reduce the costs of fossil fuel subsidies to the state budget.
On Tuesday chairman of the Upstream Oil and Gas Executive Agency (BP Migas) R. Priyono facilitated the signing of 12 business contracts on gas sales and utilization nationwide worth a total of US$1.1 million.
“The whole set of contracts will supply 215 MMSCFD of gas per day for power plants, the fertilizer business, and industry,” said Priyono.
He said further that the contracts would also entail new job opportunities for 1.400 workers.
The contracts to supply natural gas to the power sector were between the Pertamina subsidiary Pertamina EP and Palembang Administration-owned PT Sarana Pembangunan Palembang Jaya, to supply power to Palembang, South Sumatra; between Pertamina EP and another Pertamina subsidiary PT Indonesia Power for the Sunyaragi power plant in West Java; between PT Pertamina Hulu Energi, Petrochina and Regional Company Malamoi Olom Wobok; and between PT Pertamina Hulu Energi, PetroChina East Java and PT Gasuma Corporindo.
For the fertilizer industry, the contracts were between BP ONWJ and PT Pupuk Kujang Cikampek; between Pertamina EP and state fertilizer firm PT Pupuk Sriwidjaja; and PT Pertamina Hulu Energi Raja Pempirai, PT Golden Spike Energy Indonesia and PT Pertamina Gas
for Pusri; between JOB Pertamina Talisman and PT Pertamina (persero); among PT Pertamina Hulu Energi OK, Talisman OK Ltd., PT Pertamina EP and PT Pertamina Gas for Pusri; and between ExxonMobil Oil Indonesia and PT Pupuk Iskandar Muda.
For industry the contracts were between PT Pertamina EP and PT Sumber Daya Kelola; and between PetroChina International (Bermuda) Ltd. and PT Henrison Iriana.
The above included extended contracts, new contracts and amendment of (previous) contracts with a duration of one to 10 years. The total volume of gas under contract is 473,795 trillion BTU.
“It is hoped these business contracts will boost the government program on fossil fuel substitution as well as helping to speed up the national economy especially in power and electricity and other industry sectors,” said Priyono.
