T

he Energy and Mineral Resources Ministry revealed on Tuesday that it planned to add 16,000 new household gas connections in five cities across the country this year with a total investment of
Rp 230 billion (US$25.58 million).

The ministry said the chosen cities were Prabumulih in South Sumatra, Jambi, Cibinong and Cirebon in West Java, and Kalidawir in East Java.

“The city gas program aims to benefit people living near gas fields,” the ministry’s director general for oil and gas, Evita Herawati Legowo, said.

Since the program began in 2009, 38,085 households have been connected to gas in eight cities in Java, Kalimantan, Sumatra and Sulawesi, plus 11 apartments in Greater Jakarta.

In 2009, the government installed city gas infrastructure in Palembang, South Sumatra, and Surabaya, East Java. Palembang currently has 3,311 connections with a total gas supply of 1 million standard cubic feet per day (mmscfd) from Medco, while Surabaya has 2,900 connections with a supply of 2 mmscfd from Lapindo Brantas.

In 2010, the government expanded the program to Tarakan in East Kalimantan with 3,366 connections and a gas supply of 0.7 mmscfd from Medco, Depok in West Java with 4,000 connections and a supply of 1 mmscfd from Pertamina EP, Bekasi in West Java with 1,800 connections and 1 mmscfd from Pertamina EP, and Sidoarjo in East Java with 4,000 connections and 2 mmscfd from Lapindo Brantas.

Last year, the government established 3,960 connections in Bontang, East Kalimantan, with a gas supply of 2 mmscfd from Total E&P, 4,172 connections in Sengkang, South Sulawesi, with 2 mmscfd from Energy Equity, 2,828 connections in Bekasi with 1 mmscfd from Pertamina EP, 2,500 connections in Sidoarjo with 2 mmscfd from Lapindo Brantas, and 5,254 connections in 11 Greater Jakarta apartments with 1 mmscfd from state gas distributor PT PGN.

Evita said more gas connections would be installed in other cities over the coming years.

“In addition to the 16,000 new connections, we are also carrying out front-end engineering design [FEED] and detailed engineering design [DED] in Sorong [West Papua], Balikpapan [East Kalimantan], Subang [West Java], Lhokseumawe [Aceh], Cilacap and Semarang [Central Java],” she said after a video conference session with the mayors of Tarakan, Palembang and Surabaya at her office in Jakarta.

The construction of the gas connections in the six cities is scheduled to begin in 2013.

Also in the same year, FEED and DED programs will be conducted in Samarinda (East Kalimantan), Muara Enim (South Sumatra), Lampung and Pekanbaru (Riau). The construction in the four cities would be kicked off in 2014.

“We hope that in each gas-producing city, there can be two subdistricts to benefit from the city gas connection, with a total number of customers between 3,000 and 4,000,” Evita said.

During the video conference, the three mayors confirmed that the operation of the city gas infrastructure had not created profits since the consumption of gas was still lower than the amount allocated. The cities had to pay for the amount of gas already agreed with gas suppliers, although consumption did not reach that amount, they said.

“We will work to solve this problem. We have to change the model of the gas sales agreement so that operators of each city’s gas don’t experience losses,” Evita promised.